Preamble

The House met at half-past Nine o'clock

PRAYERS

[MR. SPEAKER in the Chair]

BILL PRESENTED

LOCAL GOVERNMENT (INTERIM PROVISIONS)

Mr. Secretary Jenkin, supported by Mr. Secretary Brittan, Secretary Sir Keith Joseph, Mr. Peter Rees, Mr. Secretary Ridley and Mr. William Waldegrave, presented a Bill to make provision for the composition of the Greater London Council and metropolitan county councils pending a decision by Parliament on their continued existence; to establish a commission for safeguarding the interests of local government staff employed by or in the areas of those authorities; to require those authorities and their officers to furnish information in connection with proposals for the abolition of those authorities and the transfer of their functions; to postpone the exercise of certain functions by or in relation to those authorities; and to confer rights in respect of the accounts and finances of those authorities on London borough councils, the Common Council and metropolitan district councils: And the same was read the First time; and ordered to be read a Second time upon Monday 2 April and to be printed. [Bill 145.]

Orders of the Day — Juries (Disqualification) Bill

Order read for resuming adjourned debate on Third Reading [23 March].

Question again proposed, That the Bill be now read the Third time.

Mr. Harry Cohen: Last Friday it was alleged by some Conservative Members when I was on my feet that I would not be here today to continue my speech Clearly they were wrong. Today I can promise them the same dedication and commitment to get rid of the Government at the first possible opportunity.
The promoter of the Bill, the hon. Member for Skipton and Ripon (Mr. Watson), said last week:
I tried to do some research to see what my attitude should be. I discovered from a survey carried out in 1971 that 58 per cent. of those awarded probation orders went on to commit an indictable offence within the following six years. I would therefore be reluctant to put anyone on a jury who had a six in 10 chance of going on to commit an indictable offence."—[Official Report, 23 March 1984; Vol. 56, c. 1361.]
Although he spoke of six years. that length of time does not appear in the Bill. If he had taken 10 years, he would have found a higher percentage of people going on to commit further indictable offences. It is an elastic argument for longer disqualification and it could be used in the future to extend this legislation.
The most obnoxious point about that statement is that it judges people before they are found guilty. That cannot be in accordance with the principles of law in this country. Why should the other four in 10 who do not go on to commit indictable offences be punished also by being arbitrarily disqualified from jury service for five years?
I have a constituent who can only be described as a respectable pillar of society. She is a public-spirited woman, married with three children who have been brought up impeccably, with a lovely home. She is a deeply religious woman, a Quaker, which no doubt is why she is committed to peace. She felt it her duty to the human race to express solidarity with the peace women at Greenham. On visiting Greenham she was arrested when the police were wading in and arresting many women. My constituent received a suspended sentence. Under this measure she would be banned for five years from serving on a jury. It must be wrong for such an honest and decent woman to be banned in that way.
It makes the case expressed by my hon. Friend the Member for Hammersmith (Mr. Soley) when he said last week that the Government, in supporting the Bill, were vetting the attitudes of jurors so that there would be on juries only the type of people they wanted. Because the Bill extends jury disqualification for five years for those who have committed very minor offences, and because it takes no account of subsequent reform, it will undermine the jury system and remove civil rights. Such provisions are excessive and unnecessary.

Mr. Peter Bottomley: I paused before rising because I thought that other hon. Members might wish to


speak and I wanted to make my contribution at the end of the debate. I assume that the hon. Member for St. Helens, South (Mr. Bermingham) does not wish to speak.
On Second Reading we were faced with a Bill that excited some interest but no controversy. As the hon. Member for Leyton (Mr. Cohen) will recall, the Bill was given a Second Reading without a word of opposition. It is curious that we should have been treated last week to the rather unedifying spectacle of hon. Members who were willing to wound but not to strike and who did their best to prevent the Bill from being passed.
I listened to the arguments last week and failed to understand exactly what the Opposition were trying to do. Are they against the Bill, or have they some other curious intent? The GLC makes grants to groups of people which, any objective view, cannot be said to be trying to deal with the problems of crime and law enforcement in London. At the same time, the GLC has spent £600,000 or more on groups that many people believe are anti-police and anti-law and order.
London Members come to the House and occasionally discuss interesting topics, but more often, because of lack of preparation or lack of real case, they make speeches which do not address the serious issues. No hon. Member has said that he is opposed to the Bill, but some hon. Members have said that a fair trial by a jury is impossible unless there is a reasonable chance of a recently convicted criminal serving on the jury.

Mr. Alfred Dubs: Absolute rubbish.

Mr. Bottomley: The hon. Member for Battersea (Mr. Dubs) may say that, but he listened to the speeches last week, as I did. When one hon. Member asked why we should ensure that juries do not have criminals on them, the hon. Member for Battersea did not make it plain that he thought it reasonable to exclude recently convicted criminals. I understand that the purpose of the Bill is to prevent recently convicted criminals from serving on juries, not just because they are likely to fail to convict people who should be convicted, but because, in view of their personal experience, they might be more likely to convict people who should be found innocent.
The argument for the Bill basically is that recently convicted criminals and people convicted of serious criminal offences should not immediately serve on juries. That is the sum of it.
The hon. Member for Leyton argues that a person who is a pillar of his constituency would be unreasonably excluded from jury service. He will accept that many criminals are not convicted because they have not been detected. They can serve on juries, but that is not an argument for doing away with jury trials. We must accept that there are rough edges. Many people would be happy to have the hon. Gentleman's distinguished constituent on a jury, but the law cannot be so precise as to include every decent criminal and exclude every unsavoury non-criminal. I am glad to see the hon. Gentleman nod in agreement.
It was clear last week that members of the Labour party, for reasons known only to themselves, did not want the Bill to pass, but not one hon. Member voted against the closure. I exclude the hon. Member for Battersea from most of my strictures because he is well known to be a decent, serious Member of Parliament—like most of his

hon. Friends, but he shows those qualities more clearly. I cannot understand why he was involved in the exercise. If we had been asked whether we thought that the hon. Member for Battersea would be leading what was close to a filibuster to stop the Bill, most of us would have said, "What, him! No, never."
I should not have expected such behaviour from the hon. Member for Walthamstow (Mr. Deakins). Some surprising people have been doing some surprising things. When the Bill is given its Third Reading I hope that a veil will be drawn over the hon. Members who last week did their best to block the Bill.
Two years ago there was a lot of evidence showing that people were serving on juries who should not have been. People began to consider whether the rules covering jury qualification should be tightened. It is worth remembering, although Opposition Members made no mention of it last week, that not many people spend their time breaking down court room doors demanding to serve on a jury. Most people look for every excuse not to serve on juries, not because they are not interested in justice, but because they are not particularly interested in spending time away from their work or their families. It would have been more realistic if that balance had been reflected in speeches by Opposition Members.
It is possible to deal with the views of some of the people who know something about the subject. For example, in a letter to The Times, Lord Harris said that he hoped that the Bill would succeed. He has served on the parole board and has a distinguished record of public service. He also spent five years as a Labour Minister. We should pay attention to what he says.
I do not want to make a long speech, because I fear that Labour Members will arrive in hordes. Much can be said, but simply.

Mr. Dubs: If there is not much to say, why say it at great length?

Mr. Bottomley: If the hon. Gentleman has learnt something since last week, when he went on at great length, at least something has been gained.
My hon. Friend the Member for Skipton and Ripon (Mr. Watson) has guided the Bill through its Report stage, and, I hope, through its Third reading, with distinction, courtesy and a great deal of patience. I believe the Bill to be necessary. It will be generally welcomed. If there is further delay and nitpicking, I shall make it my business to send to each person in my constituency who complains about burglaries, delays in trials or about any part of the criminal justice system some speeches by Opposition Members. The Opposition are fortunate that the reporting of last week's debate was so limited. If their constituents knew what they had said they would be most surprised. When my constituents complain to me about burglaries I shall have a great deal of pleasure in sending them the pack of information from the GLC police committee which seems to pay attention to everything except the victims of crime and how to detect criminals.
I wish the Bill a fair passage. I hope that it gets through the other place in good time and that the result will be fair juries, fair trials and an acceptance that Parliament has responded to the needs of the moment in ensuring that recently convicted criminals do not suddenly pop up to serve on juries.

Question put, That the Bill be now read the Third time:—

The House proceeded to a Division—

Mr. John Watson: (seated and covered) On a point of order, Mr. Deputy Speaker. At the time you called the Division, I was seeking to catch your eye to make a brief speech on Third Reading.

Mr. Deputy Speaker (Mr. Harold Walker): I recollect that the hon. Member was still in his seat when I put the Question to the House. I am sorry, but we cannot go back.

The House having divided: Ayes 24, Noes 0.

Division No. 216]
[9.50 am


AYES


Berry, Sir Anthony
Mellor, David


Boscawen, Hon Robert
Moynihan, Hon C.


Braine, Sir Bernard
Neubert, Michael


Cope, John
Newton, Tony


du Cann, Rt Hon Edward
Patten, John (Oxford)


Fletcher, Alexander
Steen, Anthony


Franks, Cecil
Wakeham, Rt Hon John


Freud, Clement
Watson, John


Garel-Jones, Tristan
Wolfson, Mark


Heathcoat-Amory, David
Wood, Timothy


Henderson, Barry



Hunt, David (Wirral)
Tellers for the Ayes:


Knight, Gregory (Derby N)
Mr. Peter Bottomley and Mr. Stephen Dorrell.


McQuarrie, Albert





NOES


NIL
Mr. Harry Cohen and Mr. Gerald Bermingham.


Tellers for the Noes:

It appearing on the report of the Division that forty Members were not present, MR. DEPUTY SPEAKER declared that the Question was not decided and the business under consideration stood over until the next sitting of the House.

Orders of the Day — Trade Marks (Amendment) Bill

As amended (in the Standing Committee), considered.

Schedule 1

MODIFICATIONS OF TRADE MARKS ACT 1938 IN APPLICATION TO SERVICE MARKS

10 am

Mr. Stephen Dorrell: I beg to move amendment No. 1, in page 3, line 42, leave out from beginning to first 'in' in line 3 on page 4 and insert
', for paragraphs (a) and (b) there shall be substituted the following paragraphs—
(a) in relation to services to which the proprietor of the mark or a registered user conforming to the permitted use has applied the mark, where the purpose and effect of the use of the mark is to indicate, in accordance with the fact, that those services have been performed by the proprietor or a registered user of the mark; or
(b) in relation to services the provision of which is connected in the course of business with the proprietor or a registered user of the mark, where the proprietor or registered user has at any time expressly or impliedly consented to the use of the mark; or
(c).'.

Mr. Deputy Speaker (Mr. Harold Walker): With this it will be convenient to discuss amendment No. 2, in page 4, line 14, leave out from 'services.";' to end of line 28

Mr. Dorrell: The Amendment Paper is peppered with a series of drafting amendments. None of them is of particular moment, the most substantial being amendment No. 1, standing in my name. The House is perhaps owed an explanation of how a relatively simple Bill should come before the House on Report with such a large slate of drafting amendments. Those hon. Members who have followed each stage of the Bill will be aware that it was completely redrafted in Committee. I shall seek on Third Reading to explain the reasons for that.
I am indebted to my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) and others for tabling a motion which, apparently against the interests of the Bill's sponsors, will provide the House with the opportunity to conduct a full debate on the Bill's principles on the Floor of the House. It would perhaps be right for me to deal with the details of how we arrive at this stage on Third Reading.
This amendment relates to schedule 1, which amends the provisions of the Trade Marks Act 1938, to allow the provisions of that Act to apply to service marks.
Section 4 of the Trade Marks Act 1938 deals with the right given by the registration of a trade mark. Schedule 1 of my Bill deals with registration of service marks. Section 4(3) of the Trade Marks Act 1938 applies to cases where no infringement arises as the result of the use of a trade mark. Schedule 1 of my Bill applies to the use of service marks. The purpose of amendment No. 1 is to rewrite the conditions under which no infringement arises as a result of the use of a service mark. My Bill tackles that problem by rewriting section 4(3) of the principal Act.
The parliamentary draftsman has reconsidered how we can best define the conditions in which no infringement arises and has come up with the alternative formulation which appeals to me because of its simplicity. Amendment No. 1 restates the conditions in which no infringement arises by saying that an infringement does not arise where


the person using the service mark is either the proprietor or registered user of that mark or has consent to the use from the proprietor or the registered user. It is a much simpler formulation of the object of that part of the schedule.
Amendment No. 2 is consequential on amendment No. 1. I commend both amendments to the House.

Mr. Peter Bottomley: Although my hon. Friend the Member for Loughborough (Mr. Dorrell) has promised a full explanation on Third Reading, I should be grateful if he would consider whether he should describe the significant difference between trade and service marks. If he has the leave of the House, he could perhaps explain that in relation to this amendment because it is germane to the Bill and our understanding of the further amendments. I hope that he will be prepared to do that, because undoubtedly some hon. Members are not fully in the picture as to the effect of the amendment and the distinction on which I have sought his guidance.

Mr. Dorrell: By leave of the House, Mr. Deputy Speaker——

Mr. Deputy Speaker: Order. The hon. Member does not need the leave of the House if he is replying to the debate.

Mr. Dorrell: The simplest definition of the difference between a service and a trade mark requires an examination to some extent of the history of how we reached the present state of legislation. The House will be aware that any producer of goods has the right to register the trade mark under which he intends to sell those goods so that he can promote the name and apply it to the quality of the goods. It is a well-established principle of manufacturing that, if one makes something and wants to promote it in the market place, a trade mark should be attached to it. It is an attempt to support the sales effort for that product.
Similar protection has never existed for the service industries. The object of the Bill is to provide service industries with the same protection that has been available for many years to the producers of goods, who derive that protection from the common law which reaches back into the 18th century. The matter was first codified in statute during the last century and the principal legislation that the Bill sets out to amend is the codifying Act of 1938.
At common law and in the various stages of the evolution of statute law, there has been no protection for trade marks as applied to the provision of services as distinct from the provision of goods.
Section 4 of the Trade Marks Act 1938, which is amended in respect of service marks, deals wih the conditions in which the use of a trade mark is or is not an infringement of the rights of the proprietor of a registered trade mark. It is fundamental to the existence of a trade or service mark that one must be able to protect it, and the circumstances in which the use is protected must be clearly defined.
Section 4 of the principal legislation defines when a trade mark can be used and protects the rights of the person who has paid to register the trade mark and who has almost certainly paid to promote it, and defines how he can defend the right to use what is his investment.

Amendment agreed to.

Amendment made: No. 2, in page 4, line 14 leave out from `services.';' to end of line 28.—[Mr. Dorrell]

Mr. Dorrell: I beg to move amendment No. 3, in page 4, line 46, at end insert—

Section 8

4A. In section 8(b) (registration not to restrict use of descriptions of character or quality of goods) the words from "or in" to "thirty-seven" shall be omitted.'.

All of the remaining amendments on the Amendment Paper are simple and most of them are consequential on drafting problems that have arisen as a result of amendments made in Committee.

Amendment No. 3 reflects the fact that section 37 of the Trade Marks Act 1938 has been deleted by schedule 1 in respect of service marks, but nevertheless reference is still made to section 37 in the schedule. Clearly, it is nonsense for the Bill to refer to a section of the principal legislation which another section of the Bill has deleted.

I commend this tidying-up amendment to the House. It eliminates a reference to a part of the Act which, as the result of another part of the Bill, will not apply to service marks.

Amendment agreed to.

Mr. Dorrell: I beg to move amendment No. 4, in page 5, line 24, after 'goods', insert
'or a description of goods'.

Mr. Deputy Speaker: With this it will be convenient to take the following amendments: No. 7, in page 7 line 33, after 'goods', insert
'or descriptions of services and goods'.

No. 8, in page 8, line 29 after 'with', insert 'those services or'.

No. 11, in schedule 2, page 11, line 18, after 'services', insert
'or a description of services'.

No. 12, in page 11, line 25, after 'services', insert
'or descriptions of goods and services'.

No. 13, in page 11, line 32 after 'services', insert
'or description of goods and services'.

No. 14, in page 12, line 9, after 'services', insert
'or descriptions of goods and services'.

Mr. Dorrell: As I have said, the Bill establishes a statutory framework for the protection of service marks. To understand the problem which lies behind every one of the amendments it is necessary for me to detain the House to explain the statutory method by which the principal objective of the Bill is to be achieved.
When the Bill was originally proposed to the House, the intention was to extend to service marks the protection that has always been available to trade marks. The original draft set about seeking to achieve that objective by removing completely the distinction between a trade mark and a service mark.
When the House accepted the principle of extending protection to service marks on Second Reading, the Bill was referred to the parliamentary draftsman so that he could examine in detail its technical provisions. He started by considering ways in which he could tidy up the inadequacies of the original drafting so that there was no distinction between the concept of a trade mark and a service mark. The further he progressed in that effort the more convinced he became that that was an impractical way of trying to achieve the result desired by the House. He therefore redrafted the schedules to achieve the same result by another means. Instead of removing the


distinction between trade marks and service marks, he set out instead to establish a parallel system for the registration of service marks alongside the registration of trade marks. The purpose of the amendments is to deal with some of the technical drafting problems which arose as a result of that approach. If there are two parallel systems, it is essential that there is a proper cross-over between the two systems. It is essential that the owner of a service mark should be able to protect his rights against owners or would be owners of trade marks. Similarly, it is essential that owners of trade marks should be able to defend their rights against owners or would-be owners of service marks.
The principle by which the parliamentary draftsman set to achieve this objective was by establishing parallel systems with proper cross-over defences at each and every point in the two systems. When he came to reconsider the draft which was accepted in Committee that established the principle, he discovered that the cross-overs were not properly achieved at the points defined in the amendments. he therefore suggested to me, and I am suggesting to the House, that the principle accepted in Committee should be perfected by the introduction of the amendments, which complete the link between goods and services in the operation of the Bill.

Amendment agreed to.

Mr. Dorrell: I beg to move amendment No. 5, in page 6, line 27, leave out `(i)'.

Mr. Deputy Speaker: With this it will be convenient to take amendment No. 6.

Mr. Dorrell: Amendment No. 5 is consequential to an amendment that was made in Committee. Amendment No. 6 reflects the fact that the proviso in subsection (1) of the relevant section no longer contains separate paragraphs in (a) and (b). Both amendments are drafting amendments and consequential to amendments tabled in Committee.

Amendment agreed to.

Amendment made: No. 6, in page 6, line 29, at end insert 'and the words
paragraph (a) of" and the words after "established" shall be omitted'.—[Mr. Dorrell.]

Amendments made: No. 7, in page 7, line 33, after `goods', insert
`or descriptions of services and goods'.

No. 8, in page 8, line 29, after 'with', insert
`those services or'.—[Mr. Dorrell.]

Mr. Dorrell: I beg to move amendment No. 9, in page 8, line 32, leave out -on application"' and insert
`the end of paragraph (b)'.
The purpose of the amendment is to correct the interposed modifications to schedule 1. It is a drafting amendment that deals with the technical inadequacies in the draft accepted in Committee. Many of the amendments are to that effect. The amendments reflect the result of the hurried drafting that was necessary to get them ready for the Bill's consideration in Committee.

Amendment agreed to.

Schedule 2

AMENDMENTS OF TRADE MARKS ACT 1938 IN APPLICATION TO TRADE MARKS FOR GOODS

Amendments made: No. 11, in page 11, line 18, after `services', insert
`or a description of services'.

No. 12, in page 11, line 25, after 'services', insert
`or descriptions of goods and services'.

No. 13, in page 11, line 32, after 'services', insert
`or descriptions of goods and services'.

No. 14, in page 12, line 9, after 'services', insert
`or descriptions of goods and services'.—[Mr. Dorrell.]

Mr. Dorrell: I beg to move amendment No. 15, in page 12, line 43, after 'or', insert', as the case may be,'.
The amendment brings the provisions of schedule 2 into line with the provisions of schedule 1. I shall explain the purposes of the two schedules so that the House may understand why it is important that the provisions of both should be exactly in line.
Schedule 1 is intended to make those amendments that are necessary to the principal legislation to allow it properly to apply to service marks. Schedule 2 is designed to amend the existing legislation covering trade marks so that the owners of trade marks can properly protect their rights against service marks, and vice versa. Both schedules are clearly part of the overall provision of a system that will protect the owners of service marks and allow the full cross-over process to take place. The amendment ensures that the two schedules are compatible.

Mr. Bottomley: I am anxious to ascertain that the amendment will have the desired effect, and only that. I understand that it is necessary to have a measure which relates to trade marks and service marks in parallel and which has the same effect in respect of both sorts of mark, but what happens if there is a clash between a trade mark and a service mark? Is there any suggestion that there could be a conflict between the holder of a trade mark and the holder of a service mark? Could a misunderstanding arise over whether or not one applied to the other?

Mr. Dorrell: There is a danger that the owner of a service mark may need to protect his rights against someone trading in goods. Similarly there is a need for someone trading in goods to protect or establish his mark under existing legislation against someone who either is trading in a service or would like to do so. That is why it was felt superficially attractive when the Bill was originally proposed to the House to seek not to draw a distinction between trade marks and service marks but to establish a system in which they were of the same nature, and to ensure that to every reference to goods in the principal legislation there would be added "or services", so that the system would be entirely one system.
The approach adopted by the Bill is to establish two parallel systems. Several of the amendments are designed to ensure that the cross-over, as the parliamentary draftsman chooses to call it, is complete. That applies especially to the large batch of amendments which the House has accepted, Nos. 4, 7, 8, 11, 12, 13 and 14. This means that the owner of a trade mark will able to protect his rights against the owners or would-be owners of service marks and the owner of a service mark can protect his rights against owners or would-be owners of trade marks.
The issue raised by my hon. Friend the Member for Eltham (Mr. Bottomley) is covered by the Bill and is an


important part of the principles underlying it. I can assure him that if he wants to register a service mark under the Bill he will be protected against any effort by me to take advantage of the opportunity that he has created by trading in goods.

Mr. Bottomley: I shall not delay the proceedings, but it is perhaps worth sharing with the House the idea that when two parallel systems operate in different spheres the situation resembles that which a previous Member of Parliament, Mr. A. P. Herbert, described in one of his "misleading cases." He referred to the towpath at Putney being half flooded so that there was just enough water on the road for cars still to make progress and for boats to be rowed along it. He described an incident in which a boat was coming along, sticking to the right as boats should, and a car was going along the same stretch sticking to the left as cars should. Sadly, they were going in opposite directions and collided. Who was in the right? They had parallel laws behind them so both appeared to be in the right.
I shall not pursue that further now as it is perhaps outside the scope of the amendment, but it might be worth exploring in a little more detail on Third Reading how conflicts of that kind can be resolved.

Amendment agreed to.

Mr. Dorrell: I beg to move, That the Bill be now read the Third time.
As I have said before, I am grateful to my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) and my other hon. Friends for putting down the motion,
That the Question be not put forthwith.
I am no expert on formal procedure, but I understand that such a motion is a necessary prerequisite for a Third Reading debate. My first reaction when it appeared on the Order Paper, however, was to ask my hon. Friend what his objection was to my Bill. He assured me that the motion was in no way intended as a hostile act and did not require any retaliation. It derived simply from his concern that, for my best interests and those of the House, we should have a full opportunity to discuss the principles underlying the Bill.
In common with many other private Member's Bills, the Bill was given a Second Reading after what might be described as a peremptory debate and was the subject of relatively short consideration in the Standing Committee. Now that it has been redrafted and is in its final form from the point of view of the House, it is right that we should consider the principles behind it in a little more depth. Although many of the amendments accepted today are relatively obscure in their detail, I believe that the Bill in its present form will have an important effect on the overall economy of this country and the opportunities for service industries within it.
The principal objective as set out in the long title, one of the few parts of the Bill unamended by the Standing Committee, is very simple. It seeks to
Amend the Trade Marks Act 1938 to afford registration for service marks.
As I said in answer to a question from my hon. Friend the Member for Eltham (Mr. Bottomley), the House will be aware that those who operate in service industries have

traditionally not enjoyed the same protection as those who trade in goods. The principal purpose of the Bill is to extend the protection that has long been available for those who trade in goods to cover those who trade in services.
The protection of trade marks goes back a very long time. Well before the first trade marks legislation was approved by Parliament, the principle of protecting trade marks in goods was recognised in common law as an essential part of the manufacturer's interest in promoting the sale of his goods. It was first codified in the 19th century and the present principal legislation dates from 1938. The same protection has never been available to service industries in this country, and in the context of 19th century economy activity it is not difficult to see why. Traditionally, service industries did not promote trade marks. Indeed, many were professionally based and not only did not promote trade marks, but were prevented by their rules from advertising at all.
With the development of a modern economy, the service sector has been a fast-growing area of economic activity. As it has grown, companies offering services have increasingly used a service mark as a medium to promote their services to the public. That is true of the banking and insurance sectors, and of a large number of industrial and commercial services. I cite the example of a company which sought discussions with me about the impact of the Bill on its commercial activity — the provision of roller towels and rented textiles. Here I should declare an interest as a director of a company which supplies that sector. It is a sector that I know well, which is why the interested parties came to see me. A company such as Sketchley or Initial Services which provides towels, workwear and so on to the public cannot protect the use of its name under existing legislation, although the public clearly recognise those names in exactly the same way as they recognise the name Jaguar, which is a protected trade mark, and many other names attached to the sale of goods.
The development of a modern service sector requires protection to be available for service marks to exactly the same extent as for trade marks in the manufacturing sector. The Bill is an important step in righting the balance and ensuring that the protection traditionally available for goods should also be available for services. In parenthesis, I do not regard myself as a paid-up member of the lobby which regards service industries as the great wave of the future and manufacturing as a thing of the past. The Bill is not anti-manufacturing, but pro-service. I believe that our economy requires a strong manufacturing base, but that it is in no sense in the interests of manufacturing industry to discriminate against service industries, and I strongly favour the development of a vigorous manufacturing sector.

Mr. John Watson: I appreciate the need for the Bill and congratulate my hon. Friend on his percipience in bringing it forward at this time. I was greatly interested and impressed by the power with which he advocated the need for the Bill. I am therefore the more puzzled to see that it will not come into force until 1 October 1987. If the arguments in favour of the legislation are as great as my hon. Friend has clearly articulated, surely arguments about backlogs and so forth should evaporate in the sunlight of the overwhelming need for legislation of this kind.

Mr. Dorrell: I am grateful to my hon. Friend for his comments. Perhaps he will join me in a delegation to the Minister to make that very case. I agree entirely that the sooner the Bill comes into force the better, but there is a reason for the start date mentioned in the Bill and I shall deal with that a little later.
I emphasise that the Bill is intended to allow service companies to register marks and then to be secure in the knowledge that other providers of services or goods cannot exploit the effort put into building public recognition of those marks to promote the services of those companies.
Perhaps it would be helpful if I went through the Bill's history to enable the House to understand the points that have been raised.

Mr. Edward Leigh: I hope that my hon. Friend will forgive me for making what might be considered a lawyer-like remark, but I am a little worried about the definition of goods and services, as goods might sometimes be considered a service, and vice versa. Could he explain them?

Mr. Dorrell: Clause 1(3) deals with when a registration should be regarded as a service mark. It says:
A mark falls within this subsection if it is a mark used or proposed to be used in relation to services for the purpose of indicating, or so as to indicate, that a particular person is connected, in the course of business, with the provision of those services, whether with or without any indication of the identity of that person.
Therefore, a mark is protected if it is used in connection with services. Services are not defined in the Bill because it is made clear in the principal legislation that a trade mark applies to a physical good. One of the problems with the drafting of the Trade Marks Act 1938 is that it puts clear emphasis on the need to identify a commodity to which a trade mark is linked.
As my hon. Friend the Member for Gainsborough and Horncastle (Mr. Leigh) obviously understands, the concept of a service is much more difficult to define. It is relatively easy to apply a name to a good that one can touch, but the moment one starts to apply the concept of a protective service mark in the service industry all manner of problems arise, not least where a service is delivered. Goods have a physical presence and there is no doubt about where they are, but there is a problem associated with where a service is being offered. Someone buying insurance, for example, cannot be clear whether the service is being offered in the insurance company's sales office, in the home where he is answering the telephone, or in the re-insurance market, where the insurance broker may well be laying off his risk.
A service is an abstract concept, but there is no doubt that people involved in a service industry would argue that it is an important part of economic activity. It is important to somebody operating a service that the public recognise his service and company as distinct from his competitors. To that end he must have the right to promote a service mark that identifies his service.

Mr. Greg Knight: Does not the common law already protect service marks by way of an action for passing off?

Mr. Dorrell: My hon. Friend is right to draw attention to a passing-off action. He is a lawyer and I am not so he will have experience of such action. A passing-off action also applies to goods. If it is right to improve the protection

available on the registration of a trade mark for goods as a backup to action for passing off, I cannot see why it is not right to provide the same protection for service industries. The principle of a register of trade marks, as distinct from a passing-off action, has been accepted for many years in the trade in goods and it seems reasonable that it should apply to services as well.
It is right for both because a supplier of goods or services wants to promote his name. It is important that he be able to protect that identity while the business is being built up. I understand that a passing-off action requires demonstration that the person who is passing himself off has benefited from so acting. There might be no benefit from such action for a person who is just building, up recognition of a mark. If he cannot be given protection in the vital early days, he might not take the opportunity to build up recognition of a service mark. The principle o f a service mark is widely accepted in the vast majority of other developed countries. We are not here introducing something of which no other legal system has experience We are behind rather than in front in this respect.
An examination of the Bill's history will answer the point raised by my hon. Friend the Member for Skipton and Ripon (Mr. Watson) and other matters which I am sure are lurking in the minds of other hon. Members Examination of the report of Standing Committee C reveals that, unusually, I disagreed with the schedule and the principal clause of a Bill which I had proposed and that I was re-writing the Bill before the eyes of the Committee. The Bill started in another place, where my noble and learned Friend Lord Campbell of Alloway took up the issue of service marks in the previous Parliament. He took through the Bill that was originally presented to the House on Second Reading, against the opposition of the Government.
It is instructive to consider the three arguments that the Government used to oppose the Bill, as each is an argument for, rather than against, the Bill. The first was that the EC was considering a draft regulation which would introduce a European system of registration for service marks. The Government argued that it would be sensible for Parliament to await that regulation. Some years ago Samuel Beckett wrote a play which he called "Waiting for Godot", but which he might easily have called "Waiting or the European Community". Our waiting for the EC would have been quite as long as the wait for Godot.
Bearing in mind the importance that I attach to this principle, which my hon. Friend the Member for Skipton and Ripon has underlined and which I have tried to explain to my hon. Friend the Member for Derby, North (Mr. Knight), I felt that waiting for the EC would take too long. Moreover, it is important to have a system before entering negotiations in the EC, or else we go naked into the negotiating chamber. I am sure that we were right to press ahead with the Bill and not to wait for the European Community. Indeed, it would be damaging to the interests of our service companies if we waited for the Community.
As there is no Treasury Minister in the Chamber, I can express the views of most politicians about the way in which the Treasury approaches such matters. The Government's second argument in the other place was an extraordinary example of how the Treasury sees the world. Its argument was that the introduction of service marks would require an additional 40 staff in the trade marks registry, which would involve extra public expenditure. If that were as far as the argument went, it would be


reasonable, since 40 extra staff would cost money and the Treasury, as the guardian of public expenditure, is entitled to try to restrain it, but that is not the entire story.
Anyone who registers a trade mark for goods under the existing law, or for services under the law as amended by the Bill, must pay a registration fee. The trade marks registry is no only a consumer of public expenditure, but it makes a profit for the public sector. Not only was the Treasury wrong to resist this measure on the ground that it would need 40 extra staff, but it was passing up the opportunity of having a net revenue earner for the public sector. It is another example of the Treasury's well-established principle of always looking at the gross cost and never at the net cost of any measure proposed to it.

Mr. Watson: I am interested in my hon. Friend's revealing comments. The figure that I had in mind was of about 22,000 product trade mark applications as yet undealt with. My anxiety about that backlog is that the speed of reaction and the flexibility that we have been trying for so long to encourage in British industry remains unreflected in the channels of public administration. If what my hon. Friend says is correct, it stands to reason that everything, beginning with the PSBR, would be the better if more progress could be made in clearing that backlog forthwith.

Mr. Dorrell: My hon. Friend is right to mention the backlog, which the Government used as their third argument. They said that the registry was so far behind in processing applications for trade marks that it was impossible for it to contemplate the introduction of service marks, which would only exacerabate the problem.
The backlog also lies behind the delayed start date of the Bill. As my hon. Friend the Member for Skipton and Ripon said in a previous intervention, the Bill does not come into force until 1 October 1987,
or on such earlier day, as the Secretary of State may by … statutory instrument appoint.
That alternative is important. The reason for the delayed start date was partly that the trade marks registry needed time to set up the administrative arrangements necessary to provide for the registration of service marks, and partly that it wished to clear the backlog before it introduced a new principle.
When my hon. Friend the Minister and I discussed the Bill last autumn, I suggested that 1 October 1987 should be the last date by which the trade marks registry could reasonably be expected to give effect to the provisions of the Bill, and that there would be arguments in the meantime about whether it was possible to bring forward the start date. In view of the importance of the Bill to the service industries, I am sure that many of them would wish the start date to be brought forward. My hon. Friend the Minister said that he would consider ways of bringing forward the start date if the opportunity arose. I hope that it will.
My hon. Friend the Member for Skipton and Ripon was right to say that if the public sector makes a net profit on each registration there is an opportunity to speed up the registration process, bring forward the start date and save public expenditure. All three are desirable objectives that would be achieved by the same means. However, one problem for the registry is that there is no point in building its capacity to clear the backlog and then leaving it with

staff that it does not need once the backlog has been cleared. The management of the registry and my hon. Friend the Minister will deal with that matter in the most efficient way available to them.
I have gone through the Government's arguments in opposition to my noble Friend's Bill in another place, not least because it is interesting to point out, especially to Opposition Members, if there were more of them here — [Interruption.] The hon. Member for Blyth Valley (Mr. Ryman), who is alone on the Opposition Benches, perhaps needs that lesson pointed out to him rather less than do some of his hon. Friends. However, it is interesting to note that the Bill was passed in another place despite Government opposition. It was a useful opportunity to start a principle running in Parliament that would not have existed in the House of Commons because of the greater pressure on the Order Paper and because of the much greater influence that the Government can exercise over the decisions of the House.
After my noble Friend successfully piloted his Bill through the other place, he asked me whether I would promote the Bill through this House during the previous Session of Parliament. I took up the Bill and corresponded with my hon. Friend the Member for Reading, East (Sir G. Vaughan), who was then Minister for Consumer Affairs, but there was no progress before the general election. After the election, and when I was fortunate enough to draw a place in the ballot for private Members' Bills, I visited my hon. Friend the present Minister to see whether we could arrive at an arrangement whereby the Government would accept the Bill. I thank my hon. Friend for his efforts, in his Department and in the Government, to overcome the opposition that was expressed in another place. He has provided time and facilities in his Department and in the trade marks registry to ensure that the Bill, as it is presented on Third Reading, will achieve the result that I and its sponsors wish it to achieve. I am grateful for his support, which I hope he can record to the House today.
The history of the Bill explains the tortuous legislative path that it has taken through the House and its various stages during this Session. The original Bill, which, with the agreement of my hon. Friend the Minister, I promoted in the autumn and which was passed by the House on Second Reading, was the same Bill that passed through the other place last Session. However, with all such Bills, drawn up as it was by private enterprise and without the expertise of parliamentary draftsmen or the trade marks registry and the Department of Trade and Industry, it was found to be defective in several important respects. Consequently, it was necessary to rewrite all its major provisions.
As I told my hon. Friend the Member for Eltham on Report, the approach adopted in the original Bill was to regard trade marks and service marks as the same thing and to try to set up a system in which there was no legal distinction between them. When the parliamentary draftsman considered in detail how that principle could be given statutory effect, he concluded that every time he solved a drafting problem, he created two more, and that he was getting further and further into the mire. He therefore decided that he had to adopt the totally different approach of setting up parallel systems, which I have already described.
I am neither a parliamentary draftsman nor a qualified lawyer, so when the draftsman put his proposals to me, I


met him together with my noble Friend Lord Campbell of Alloway, who is a practising lawyer. My noble Friend and I went together, because I felt that I needed an expert to point out any pitfalls into which I might otherwise fall. However, my Friend as a practising lawyer was very complimentary about the drafting of the Bill as it now stands and the amendments proposed in Committee. He said that the Bill as it stands was clearer than many of the Bills that passed through the House. We all know that many Acts can be heavily criticised for their drafting inadequacies, but I am assured that this measure will meet fewer criticisms than the majority of Acts received.
I shall briefly describe what each stage of the Bill achieves. There are only two clauses. Clause 1 is the main active clause and it defines—as I said in reply to my hon. Friend the Member for Gainsborough and Horncastle —a service mark. It then brings into effect the two schedules attached to the Bill. Schedule 1 deals with the modifications of the Trades Marks Act 1938 in its application to service marks. In other words, it seeks to amend the Trade Marks Act so that, read as a result of the amendments in schedule 1, it almost becomes a service mark Act. It provides a statutory framework, separate from trade marks, that will ensure the protection of service marks. That is the objective of schedule 1.

Mr. Leigh: I know that my hon. Friend is anxious not to delay the House, but I have read that the logos employed by banks and insurance companies like Dyno-Rod for plumbing services are an example of service marks. Does my hon. Friend have any information on how the Bill might affect the agricultural sector? He will know, of course, that I represent an agricultural seat.

Mr. Dorrell: My hon. Friend mentioned Dyno-Rod in the context of banks and insurance companies, and I look forward to the appearance of the Dyno-Rod bank or insurance company on the high street of Loughborough.

Mr. Leigh: It will happen.

Mr. Dorrell: Perhaps it will happen in the context not of a bank or insurance company but of an agricultural service company. However, I cannot, offhand, think of an agricultural service industry, although I suppose that the NFU might set out to protect NFU——

Mr. Watson: Does my hon. Friend not agree that Rentokil is a reasonable example?

Mr. Dorrell: In some circumstances, yes. Rentokil, obviously, is a pest control company that is concerned with controlling pests in agricultural buildings. As I was about to say, there are circumstances in which the NFU might seek to promote its logo as a service mark to the agricultural community. I suppose that if some of my hon. Friends had their way and we privatised not only British Telecom but the Agricultural Development Advisory Service run by the Ministry of Agriculture, Fisheries and Food—and I would be strongly opposed to such a move — ADAS would be a major service enterprise which could want to protect its right to its name.
There are many service sectors that serve all parts of the economy. Clearly, banks and insurance companies serve agriculture just as they serve every other part of the economy. When my hon. Friend the Member for Gainsborough and Horncastle is asked by the NFU how he has defended its interests, he will be able to refer to this morning's debate not only because of his own splendid

Agriculture (Amendment) Bill—which I am sure will be regarded as important by the NFU—but because of his protection of service marks. After all, they serve agriculture just as they serve other parts of the economy.
Schedule 2 is designed to amend the Trade Marks Act in its application to trade marks for goods. My hon. Friend the Member for Eltham mentioned the point of cross-over. It is obviously important that the owners of existing trade marks for goods should be able to protect their rights against owners and would-be owners of service marks. Since the existing trade marks legislation does not admit of the possibility of a service mark, some amendment as required to the existing legislative framework to ensure that the cross-over applies not only to those seeking to register and operate service marks, but to those who have sought, and will in future seek, to register trade marks applicable to goods. Schedule 2 amends the Trade Marks Act as it applies to trade marks for goods, while schedule 1 re-writes the Trade Marks Act so that it provides a proper framework for the protection of service marks.
I believe that the Bill represents an important extension of our commercial law. It also represents an important new opportunity for service industries in Britain to promote the market recognition that goes with the service mark. I am grateful to those in the Government who have offered their support in bringing the Bill to this stage in its proceedings, and I warmly commend it to the House.

Mr. John Ryman: I welcome the Bill and congratulate the hon. Member for Loughborough (Mr. Dorrell) on all the work that he has done in preparing it. It is supported by both branches of the legal profession and there has been correspondence, which I have seen, between representatives of the Law Society and the hon. Gentleman. I have also received correspondence from the Senate and Bar Council Law Reform Committee strongly supporting the Bill.
I pay tribute to Lord Campbell of Alloway for moving the Bill in the other place. He is a respected and distinguished lawyer with great expertise in this area of law. The hon. Member for Loughborough was very lucky that such a distinguished and respected member of the legal profession should have moved it in the other place.
As the sole representative of any Opposition party in the Chamber this morning, I should place it on record that the Labour party warmly supports the Bill. I do not know what views, if any, the SDP and the Liberals have on it, but I do not suppose that they have any views about it, because it is not a bandwagon that they can jump on, and they show no interest whatsoever in this type of legislation. However, the Labour party warmly welcomes the Bill, because we are, of course, interested in the service industries.
As the hon. Member for Loughborough rightly said, the Bill is in no way against the interest of the manufacturing industries. We deplore the tenor of Government policy in running down manufacturing industry by reason of their asinine economic policies and their deliberate discrimination against manufacturing industry, but we recognise the value of the Bill in helping the service industries that we are as anxious to promote as we are to promote the manufacturing industries.
My constituency in the north-east of England has suffered enormously from the Government's wicked policies against manufacturing industry, especially the


abolition of special development areas and the recent introduction of the White Paper on regional policy. At the same time, we are working hard not only to rescue manufacturing industry from the worst features of Government policies, but to create and build up service industries. Those service industries will greatly appreciate the Bill, and the Opposition welcome it.

11 am

The Under-Secretary of State for Trade and Industry (Mr. Alexander Fletcher): It might be helpful if I intervene now to present the Government's view on this important legislation. I wish to express my pleasure in congratulating my hon. Friend the Member for Loughborough (Mr. Dorrell) on so ably steering this complicated piece of legislation through the House.
As my hon. Friend said, in its original form the Bill was somewhat shorter. When we decided that it should receive Government support, we saw a number of ways in which its intention could be more completely expressed —hence the Bill before us today. Its purpose is to help the service industries, which form a vital sector of our economy, by extending to them much of the help and support already available to the manufacturing sector.
Many of the service industries have expressed strong support for the Bill, which will be of great use to them. Just as the existing legislation system for trade marks applied to goods is flourishing, so I expect great use to be made of the new facility for the registration of service marks.
We cannot over-stress the growing importance of the service industries to the British economy. The latest figures that I have show that services now employ 13·3 million people, against 5·8 million people in the manufacturing industries. Contrary to what the hon. Member for Blyth Valley (Mr. Ryman) said—he was the only member of any Opposition party to attend the debate, but he has now left — about support for manufacturing industries, as against support for service industries, it is a fact that 93 per cent. of my Department's support financing still goes to the manufacturing sector, as against 7 per cent. to the service sector.
Services now provide 56 per cent. of the gross domestic product, as against 24 per cent. from the manufacturing sector, so we can see the growing importance of the service sector to the British economy. Although the Bill may appear to be a modest piece of legislation, it will have a significant effect on the largest sector of the economy.
I agree with what my hon. Friend said about the Bill. It is not anti-manufacturing, it is pro-services. As such, it corrects a serious imbalance in the justifiable protection that industry and commerce have a right to expect. It also brings the United Kingdom into line with the practice of many of our major competitors. That, also, is to be welcomed.
I should say something about the concept of and the background to the Bill. Analyses of the nature of services and of the use likely to be made of service marks showed that although it was both desirable and advisable to introduce protection for service marks by means of the Trade Marks Act 1938, a number of its provisions were inapplicable to or inappropriate for service marks. There are also a number of circumstances in which the coexistence of service marks and trade marks would create

a need for protection or control, which was not necessary when the law had been concerned only with trade marks. The drafting for that was done some time before the war.
In some cases difficulties arose because the 1938 Act was built on previous legislation and also on the recognition that the common law afforded to unregistered trade marks. Service marks have not yet been recognised as giving rise to any rights at common law or under statute law. Although, at common law, even before any trade marks legislation came into being, it would have been possible for one person to bring an action against another for having wrongly used his trade mark, no such action can be brought and no remedy is available for the wrongful use of another person's service mark. As a number of my hon. Friends have said, the action would be for passing off one's business or someone else's business, and the fact that someone had used another person's service mark would simply be evidence and would not afford a separate cause of action in its own right.
Throughout the 1938 Act there is a close link between the trade mark and the goods on which it is used—goods being tangible items and the use of a trade mark being a physical use upon those items. Conversely, upon analysis a service can be seen to be simply the performance of an action which may or may not be an action performed upon or in relation to goods. It is a disembodied concept that has no physical existence and does not necessarily produce any physical effect.
For that reason, substantial parts of the 1938 Act drafted by reference to use of the mark in relation to goods require not simply to be verbally amended, but to have the action or use which they were designed to prevent or permit in relation to trade marks and goods analysed and transferred by analogy to actions and uses that need to be prevented or permitted in relation to services. That is a summation of what my hon. Friend said.

Mr. Dorrell: My hon. Friend is to be congratulated on expressing the somewhat complex thoughts that I tried to express, very much more briefly and elegantly than I was able to do.

Mr. Fletcher: I am grateful to my hon. Friend. One has the advantage, as a Minister, of some back-up services that are rather helpful in describing something as complex as this matter.
The amendments that resulted from the analysis of the problem were designed to approach the introduction of service marks in a way that would make the amendments to the Act easier to identify and to implement, while at the same time to deal more fully with the differences that will necessarily exist between the use and manner of use of service marks and the use and manner of use of trade marks.
The amendments also reflect the consideration that the trades marks registry has given to the way in which the registration of service marks would be carried out; to the practical difficulties that would otherwise arise as the result of absorbing into a system designed to deal with marks relating to physical goods, a system of marks that relate to the abstract concept of services and to the need to ensure that goods marks and service marks can co-exist in ways that might create confusion in the public mind.
As examples of the differences between the amendments that have been made and the provisions of the original Bill, I refer to amendments to remove from the


Act, in relation to service marks, provisions that are not applicable by virtue of the fact that the law in relation to trade marks at the date of the Act differs from the law relating to service marks.
Amendments have also been made because, upon analysis of the way in which it is anticipated that service marks will be used, it has been necessary to look closely at the use of marks in relation to both goods and services and to all possible relationships between goods and services. Analysis shows that, whereas in respect of trade marks it is sufficient to ensure that there is no confusion between goods and goods, when service marks are introduced the possibility of confusion multiplies. Services can be confused with services or with other services of the same type. The goods could also be confused with services, and types of goods could be confused either with specific services or with types of services. Therefore it has been necessary to erect a series of cross-comparisons between services and goods at every level at which it is possible confusion might be caused by the use of the same mark where permitted.
Amendments were necessitated by the Act referring to concepts that are meaningful in relation to goods but meaningless in relation to services, and these amendments were designed to provide an equivalent protection. Other amendments were necessitated by the Act referring to concepts that need to be wider in relation to services—that is necessary in relation to goods. Amendments arose also from the fact that services could cause problems both from the place where they are used and at the place where they are offered for acceptance. Further amendments were necessitated by the fact that a trade mark exists on goods and identifies the goods as being those of the proprietor, whereas the service mark, although it may be physically attached to goods, makes a statement about an activity.
As schedule 1 provides for cross-relationships to be considered where such consideration is needed in consequence of a service mark, schedule 2 is necessary to make the changes in the Act in relation to trade marks for goods, where such changes are necessary, to enable cross-relationships to be considered in consequence of a goods trade mark application.
The Bill has an operative date of 1 October 1987 or such earlier date as the Secretary of State may appoint. I appreciate the concern shown by my hon. Friend this morning and I hope that we can manage an earlier date of implementation for this important Bill. The trade marks registry is under considerable pressure of work, although I am glad to say that it is making inroads into the backlog. The backlog of unexamined applications is not 22,000, as my hon. Friend the Member for Loughborough suggested, but 17,000, although that is still a hefty figure. The annual current input of applications is 22,000 and we are achieving an examination rate of over 24,000 a year—that is, we are eating into the backlog, and we hope to improve that performance still further. The operative date of 1 October 1987 is based on our reducing them to a level that would not jeopardise the orderly examination of existing trade marks and the introduction of the new service mark system.

Mr. Watson: If my mathematical interpretation is correct, and if I heard my hon. Friend correctly and the current backlog is 17,000, if we are dealing with applications at the rate of 25,000 a year and applications

are being received at the rate of 22,000 a year, am I not correct in the belief that it will take seven years to clear the backlog?

Mr. Fletcher: That is correct, on my hon. Friend's premise. I am not questioning his arithmetic. However, we are examining ways to improve the rate of reducing the backlog and that factor concerns me as much as it concerns my hon. Friend.

Mr. Watson: I am grateful for that reassurance, but may I crave my hon. Friend's indulgence by asking for a further reassurance that he will not wait until the backlog is cleared entirely before bringing the measure into force?

Mr. Fletcher: That is why the date of 1 October 1987 is the latest date for implementation. We hope to improve significantly on that date.
We have discussed the backlog, and the extension of the registration system to service marks will require substantial preparation in the registry. Nevertheless, we have to introduce new service marks registration as soon as possible and, I hope, significantly ahead of the cautious target date that we felt obliged to put into the Bill.
I believe that the whole business community supports the Bill and that it will be indebted to my hon. Friend the Member for Loughborough for so successfully piloting the Bill through all its stages. I am glad to be able to give him the support of Her Majesty's Government in bringing this important Bill to the statute book.

Mr. Edward Leigh: It is with great pleasure that I rise to support my hon. Friend the Member for Loughborough (Mr. Dorrell) on this important Bill. I must confess that before this week I had not given these important issues much thought, but I have found this morning's debate so stimulating that I feel I must say a few words. There is no doubt that, as has been explained, this Bill will be of importance not only to the industrial and service sectors, but to the agricultural sector, which is of such importance to my constituency.
I understand that there is large and growing support for this Bill both from organisations such as the Confederation of British Industry, the Building Societies Association and the Computing Services Association and from individual companies such as Barclays Bank, the Norwich Union Insurance Group and GKN. I understand that they are convinced that the registration of service marks will help them in safeguarding and expanding their activities at home and abroad.
The United Kingdom is increasingly out of line with the rest of the world. In the EEC, only Greece and Ireland, apart from ourselves, have not introduced service marks registration as proposed in the Bill. Worldwide, there are now more than 60 countries with service mark registration, recent additions being Australia and the Federal Republic of Germany.
The registration of service marks will reflect the increasing importance of the service industry. It is true that common law protection for service marks already exists in this country by way of passing off actions but such actions are difficult and expensive. Further, passing off rights are effective only where reputation is established, and they may prove to have no value to a firm that wishes to expand nationally.
An additional factor in favour of service mark registration is the draft Community legislation to introduce


a Community trade mark system. This does not give unregistered rights an opposition right against a Community trade mark application. Even if we are successful in negotiations to give such rights to unregistered service marks, United Kingdom firms will still be faced with the difficulty of proving reputation for the purposes of the opposition action. Moreover, a United Kingdom company that operates in a particular locality may not be able to prevent a foreign rival from registering its mark as a Community mark and using it outside the locality.

Mr. Dorrell: Is it not significant and strange that the strong argument in favour of the Bill being advanced by a large number of its supporters, is that pre-registration will improve our bargaining position when it comes to the European system? It is significant that it was the promise of a European system at some stage in the future that was an argument against the Bill when it was first proposed in the other place. Is it not an interesting reflection on the weakness of the argument against the Bill and the strength of the arguments for it that the prospect of European legislation has been used on both sides of the argument, but much more convincingly by my hon. Friend in support of the Bill than by others against it?

Mr. Leigh: I agree with my hon. Friend, and it is a mark of his parliamentary ability that he has introduced the Bill now and in such an able way. I understand that service mark registration will be entirely consistent with existing and projected European Community legislation.
There are also disadvantages abroad in not having registration in the United Kingdom. In particular, in some ex-British colonies a United Kingdom registration facilitates registration locally, and in the United States lack of United Kingdom registration means that the British applicant has to show proof of use in the United States.
Those are just a few arguments that I have managed to research in favour of the Bill. I warmly commend the measure to the House.

Mr. John Watson: I am grateful for the opportunity to make a brief contribution to the debate.
This is a very important piece of legislation, and my hon. Friend the Member for Loughborough (Mr. Dorrell) is to be congratulated on its introduction. By way of an aside, it is a fair commentary on the attitude of the Opposition to the importance of such measures and the need to protect British industry and its ingenuity to the full that their attendance at the moment amounts to precisely nil.
The Bill has a great deal to commend it, for two reasons, although I have one fairly substantial reservation about its possible operation. First, it will tilt the balance between product protection and service protection.
The general sphere of industrial protection that we have in Britain for industrial ingenuity and competence can be broadly described as satisfactory, but until the introduction of the Bill that could not be said for the service industries. The manufacturer of a product normally will look to four specific means to protect his product, in addition to the fifth one available under common law. He can apply for trade mark registration and for patent coverage. He

possesses copyright, and he can apply for registered design as well. Until now, only the last two have applied to service industries—copyright and registered design. As we have heard already, the fifth area of protection of the common law right against passing off is limited in its effectiveness because of the burden of proof and the expense of bringing a case.
Until now, the protection available to service industries has rested almost entirely upon copyright and registered design. Until now, it has not been able to rest upon the concept of trade mark. That has put service industries at a severe disadvantage compared with manufacturing industries. What is even more important is that it has put service industries in the United Kingdom at a disadvantage compared with their competitors overseas specifically because copyright and registered design, which are available to service industries, tend to have their greatest power in the earlier years of the development of a product or service.
The real protection of a product which has been on the market for some time is normally that of trade mark. Until the introduction of this legislation, that protection was denied to service industries. Therefore, it is a sensible and fitting introduction of a piece of legislation which restores the balance and enables service industries to compete with the benefit of all the protection hitherto available to manufacturers. That is important, because just as much intellectual ingenuity goes into the development of a new service as ever goes into the development of a product. To deny adequate protection to that ingenuity until now has been a national weakness.
The second reason why I am pleased to welcome the Bill is that it restores the balance between the United Kingdom and most of our competitors in the EEC. As my hon. Friend the Member for Gainsborough and Horncastle (Mr. Leigh) reminded us, the only other nations in the EEC which have not found it necessary until now to have service mark protection are Greece and Ireland. It is worth pointing out that when we first went into the EEC, and even nowadays when people continue to debate whether we should remain a member, one of the principal arguments for British membership is that we believe that our service industries can score heavily in Europe. People draw attention to the facilities of the City of London, banking, shipping, insurance, Lloyd's of London, the commodity markets and all the consultancy services which we have to offer. If there is a future for Britain in the EEC producing a significant balance of payments surplus, visible and invisible, I believe that it will be substantially through the development of our service industries in that market rather than simply the manufactured products which have dominated our exports hitherto.
However, one or two matters which have emerged from the debate have provided substantial reasons for my reservation about how the legislation may operate. I refer again, perhaps inevitably, to the backlog of trade mark applications about which we have heard.
I draw attention to four facts which have emerged. The first is that it is almost certain that the Bill will not come into force for three and a half years because of the backlog of unprocessed applications for trade marks. The second is that that backlog now stands at 17,000. The Minister told us that 25,000 applications were dealt with each year but that 22,000 new applications were received each year. If the backlog is being cleared at the rate of 3,000 per


annum, there is no possibility of the Bill coming into force any earlier than the three and a half year statutory minimum laid down in the legislation.
The third factor is the apparent attitude of the Treasury in saying that it cannot do more to reduce the backlog because to do so will involve the employment of 40 additional staff. I find that an astonishing reason. We have 620,000 civil servants. It is astonishing for the Treasury to suggest that in one vital sector British industries should remain unprotected because the provision of protection would involve the employment of an additional 40 civil servants. That is one of the most implausible reasons that I have heard, even from the Treasury.

Mr. Dorrell: Will my hon. Friend pause for a moment to reflect upon the magnitude of his statement? He said that that was an implausible argument even by the standard of argument that emerges from the Treasury. That is a major statement and quite an important criticism of the argument.

Mr. Watson: I have reason quite frequently to reflect upon the magnitude of my statements. I am happy to do so again.
I draw attention to one further fact to have emerged from the debate. It is that the charges made for trade mark applications are not intended, as I had supposed, to be sufficient merely to cover the costs of dealing with applications, but are intended to provide a significant degree of profit.

Mr. Dorrell: Hear, hear.

Mr. Watson: My hon. Friend says, "Hear, hear." I do not believe that that should be the case. If the purpose of registering trade marks is to give protection to British service industries, that should be clearly stated as the objective. In other words, the trade marks registry should regard itself essentially as the protector of the public interest and as an organisation which exists to support British industry. It should not regard itself as an independent profit centre in the Government seeking to produce further reductions in the public sector borrowing requirement.

Mr. Fletcher: It would be quite wrong to overcharge. In the European context we ought not to be able to overcharge and to make an unnecessary profit, but one of the reasons for the backlog is that we need to computerise applications and use modern information technology, and the system is not nearly as up to date as it should be. My hon. Friend will probably agree that in working out the figures and in considering any surplus which the registry might accumulate we must include sufficient funds to provide the up-to-date equipment and services necessary to reduce the backlog and to produce a better service for British industry.

Mr. Watson: I agree enthusiastically that the charges for trade mark applications should include not just the cost of their administration at the moment but some provision for future administration. If that involves the acquisition of a computer, so be it. However, I am astonished to discover that the registry does not yet have a computer.

Mr. Fletcher: It does.

Mr. Watson: I am delighted to hear that. Presumably the registry is on the point of getting a bigger one. I suggest that of the 22,000 people who submit trade mark

applications each year, all but about 1 per cent. will have computers. How the nation will receive the news that the registry is not yet fully computerised, I do not wish to speculate.

Mr. Fletcher: It is important, if only for the record, that I should make it clear that the trade marks registry uses computer services and that there is need greatly to expand and bring up to date the use and application of those services, not least for service marks, which is an ideal field for computer application.

Mr. Watson: I agree with my hon. Friend and I shall not labour the point further. He has impressively allayed doubts that were beginning to surface in my mind on that score.
Speed of reaction in British industry is not only necessary now but will be increasingly so if we are to compete in the world in the 1990s and towards the end of the century. If that speed of reaction—which we in Parliament are doing so much to encourage in British industry—remains unreflected in the public sector— in the Treasury or elsewhere—and if the delays of which we have heard continue for a further three or four years, then, beyond the bounds of this Bill, there will be grounds for concern. Therefore, I give the Bill my enthusiastic welcome and I am grateful to my hon. Friend the Member for Loughborough for introducing it.

Mr. Tim Smith: I apologise for not being in my place earlier. It was only recently that I heard that the Third Reading would be taking place. I am an enthusiastic supporter of the Bill and I congratulate my hon. Friend the Member for Loughborough (Mr. Dorrell) on having introduced it, especially as it has had something of a chequered career.
About a year ago I attended an excellent lunch given by the British Franchise Association, an organisation of small businesses concerned with different kinds of franchise operations. Much to my surprise, most of the questions put to me were not about Government small business policy but about the need to do something about registering service marks. Strong feeling was expressed that the Government were dragging their feet on the issue and were not being particularly helpful to those who were sponsoring a similar measure in the last Parliament.
This is, therefore, a welcome Bill, and, in addition to congratulating my hon. Friend on introducing it, I congratulate the Government on the conversion which they apparently have undergone. Now, with the support of the Government, the Bill should make speedy progress on to the statutue book.
Because of a lack of service mark protection in the United Kingdom, at present there is no adequate protection for a large area of commerce. Banking, insurance, entertainment, franchising, printing, restaurant services, repair services and leasing—for example, of cars and television — are only some of the commercial areas which are adversely affected by this lack of protection. That list illustrates the extent of the protection which the Bill will provide.
The inability to register a trade mark for services in the United Kingdom is a serious defect in our law and a considerable disadvantage. Many other countries provide for the registration of marks for services, and Britain is out


of step to the disadvantage of its citizens. The lack of service mark protection here hinders the securing of such protection in other countries, especially in countries in which the existence of United Kingdom registration could be helpful, such as the United States.
If a trade mark, whether for goods or services, is not registered, it can enjoy common law rights which can be used to prevent others from passing off their goods as one's own, but—and it is a large but—to enforce such rights one must have acquired an extensive reputation and good will in the mark, and that can be acquired only through considerable use. Further, one must first prove that one possesses such a reputation. Not only is that difficult, expensive and time-consuming, but it is not available to a new or young service company which has yet to make its mark. That point was made to me at the lunch to which I referred, at which most of the businesses represented were new and young and not able to take advantage—as they are not able to take advantage today — of the common law, and that is why my hon. Friend is right to introduce the Bill in its present form.
Last year there was considerable correspondence on this matter. At that time the Government opposed a measure such as this for a number of reasons, the first being that they said that there was no demand for such a Bill. I imagine that in the intervening period sufficient voices have been raised to persuade the Government that there is a demand, both in manufacturing industry and in branches of service industries.
My hon. Friend the Member for Loughborough may be able to help me with another argument that was then used by the Government in relation to staffing implications. There does not appear in the Bill anything about its cost to the Exchequer or the staffing implications.

Mr. Dorrell: That point has been the subject of considerable debate this morning, though I appreciate that, because of an important engagement, my hon. Friend was not able to be present all the time. The employment implication for the trade marks registry of the passage of the Bill is estimated to be the recruitment of a further 40 civil servants, but the fees that will be earned by the registration of new service marks will more than offset the charge to the public sector incurred by the employment of the extra staff. In other words, the consequence of the passage of the Bill will be a small improvement rather than a deterioration in public expenditure.

Mr. Smith: I am grateful to my hon. Friend for his explanation. Last year, one objection to the then measure was that, in addition to the present 200 staff at the registry, an additional 50 would be required. Now, it appears, the additional number required is 40. I am interested to learn, too, that, because the registry will be self-financing, there will be no additional cost to public funds.
It is clear that the objections that were raised last year are no longer valid. I hope that the Bill, when enacted, will provide the protection for service companies that it is designed to provide. I am sure that it will be widely welcomed.

Mr. Bottomley: The Bill has shown what persistence can bring as a reward. The House will wish to pay tribute not only to my hon. Friend the Member or Loughborough

(Mr. Dorrell) but to Lord Campbell of Alloway, who initiated the parliamentary push for legislation in this sphere. I welcome what the Minister said and the way in which he said it. It is nice to see Government responding to sustained parliamentary interest in a subject. That is the way in which Parliament should work, and tributes are deserved all round.
Putting the Bill in context, it should be seen not just as a matter of protection for those who establish significant, or even insignificant, service marks, but in the context of competition in that consumers have an interest not only in straightforward competition between different providers of services, as well as goods, in terms of price, delivery and quality, but in competition to establish in the public mind a degree of quality, reliability and dependability.
As enterprises try to establish their names before the public, they should have reasonable protection from others who want to cash in on a reputation which has been gained by the expenditure of effort and money. The Bill will help to do that in a way which will make it easier for the providers of services to establish effective protection for what they have created.
The development of common law has been significant in giving rights to the owners of service marks before the establishment of the Trade Marks Act, which this measure amends. This Government and Parliament—perhaps we should talk more of the Government side of the House because Labour Members appear temporarily to have a lack of interest in service marks and trade marks—are going forward in creating greater certainty in the law and greater opportunity for competition and protection for the rights of those involved in that competition. This is good for providers and consumers of services.
In the international context, it is encouraging that we are, without too much opposition, able to deal with a Bill which is in line with our Common Market obligations. It is a sign of how we can develop within the Common Market. It is in the consumers' interests, not only to solve the budget problem but to develop the Common Market. There is an advantage in having similar legislation throughout the Community. We shall gain by having similar legislation on service marks and trade marks for Birmingham and Bradford. I look forward to the day when the Common Market is developed so that, after reasonable discussion and debate, Community law provides with the same ease for the establishing of services and their protection throughout the European Community. That is what the Community means in an economic and business sense. That is what it means in a consumer sense.
Counterfeit goods from places such as Taiwan with identical or similar trade marks, trade names or packaging are a great danger to consumers. For example, fake or imitation brake linings can pose an enormous danger if they are not up to the right standard. On a less serious note, may I say that an hon. Member visited Taiwan and was proudly shown some suiting which on the selvedge boasted the words, "Made in Hiddersfield". I do not know whether that was an intended distinction or a mistake in the English.
The danger involved in service industries is not quite as great. The danger is more that established companies will not think it important to keep a high reputation. Many firms with household names have built up their reputations for service and retailing. The protection that the Bill extends to them will be welcomed. The Bill will make it more likely for a significant body of consumers to react in


the right way to companies which provide services which are distinctly better than those of their competitors. That competitive pressure must be in the long-term interests of consumers.
Later we can discuss whether it would be worth our while for the European trade mark office to be established in Britain. Once the Bill is passed our claim is more likely to be considered and taken seriously. I go further. When we manage to abolish the GLC we should move the European Parliament to county hall so that we may have more influence than we seem to have had in the past. I would not mind taking over the Crown Agents building so that I could work in the same offices as my grandfather did many years ago.
It is important that Parliament has been able to react in the way that it has, to isolate an area which needs improvement and to pay not too much attention to the idea that common law provides protection. The Bill was considered on Second Reading, changed in Committee and again on Report and will pass to the other place. Parliament exists to conduct that type of revision. I am glad that my hon. Friend the Member for Loughborough has persisted with his Bill. He has provided the explanations that the House rightly requires. I am glad that Back-Bench Members and Ministers have co-operated. I hope that the Bill fulfils the purposes ascribed to it and that it will contribute to greater competition and more protection for the providers of services.

Mr. Dorrell: Perhaps I might be permitted to draw together some of the strands of the debate. I am grateful to hon. Members for welcoming the Bill. One or two matters need to be emphasised before the House reaches its conclusion, because this is the last opportunity that we shall have to debate the issue before it goes to the other place.
Several of my hon. Friends and the hon. Member for Blyth Valley (Mr. Ryman) mentioned correspondence from a wide section of the community supporting the principle of the Bill. As my hon. Friend the Member for Beaconsfield (Mr. Smith) said, during the early discussions on the proposals doubt was expressed about the extent of genuine public demand for the opportunity to register service marks. If that doubt existed, there is no room for doubt now about the genuine demand.
My hon. Friend the Member for Beaconsfield mentioned the franchise operators. They are an important, major and developing part of the economy, and under the Bill they will be protected in a way that they never have been before.
The hon. Member for Blyth Valley might have mentioned, as he did in Committee, that among the organisations supporting the principle of the Bill is the co-operative movement. I hope that that will commend the Bill to the hon. Member for Norwood (Mr. Fraser) and to other hon. Members who may take an interest in the Bill even at this late stage.

Mr. John Fraser: I have supported the principle for several years. Sometimes one best helps a Bill by not saying anything in favour of it.

Mr. Kenneth Hind: I have listened to the debate with interest. I am convinced of the need for the Bill, because of the major legal problems. People

argue that service marks are protected by common law, but the sheer difficulty of gathering sufficient evidence to bring a case that is likely to succeed is overwhelming. The preparation of such a case is blocked at every turn. I am sure that statistics will show that successful cases are few and far between. We can look forward to offering greater protection to the service sector.

Mr. Dorrell: I am grateful to my hon. Friend for underlining an important argument. He is right. The action for passing off is not an adequate alternative to the right to register a trade mark or a service mark. That has been accepted in respect of trade marks since the end of the last century. I do not understand why it has taken us so long to accept the same principle for services as has applied for many years to trading goods.
I am pleased that the hon. Member for Norwood is such a strong supporter of the Bill. I hope that the correspondence from the co-operative movement will convince those who support the Bill to continue to support it, and others that there is no reason to oppose it. Support for the Bill has come from an enormously wide section of the community.
The hon. Member for Blyth Valley and the Minister said that to be pro-services one does not need to be anti-manufacturing. The Bill substantially improves the position of service industries, but not at the expense of manufacturing. It is a case of "and", not "either/or'. That is vital, particularly for those of us who are interested in the future of manufacturing industry and do not agree that manufacturing is inevitably and irretrievably in decline.
Some interesting points were made about the Bill in the European context. My hon. Friend the Member for Gainsborough and Horncastle (Mr. Leigh) pointed out that Greece and Ireland are the only other countries in the Community which offer no protection for service marks. I do not believe that the House wants to line Britain up with Greece and Ireland as countries which do not protect their service industries. We should be the forerunners, not the laggards, in Community law. I hope that that argument commends itself to the House.
My hon. Friend the Member for Eltham (Mr. Bottomley) referred to the importance of this principle in improving the workings of the Community's internal market, especially in the context of the present discussions in Brussels about other aspects that seek to reduce the trade barriers for services. My hon. Friend made the interesting point that, within the Community and the domestic market, the easier it is for the supplier of a service to promote public recognition of that service, the more genuine is competition within the market. The Bill is not only a measure to defend the interests of the providers of services. It is a piece of legislation to enhance genuine competition in the provision of services to the consumer. That is important.
One reservation mentioned in some detail by my hon. Friend the Member for Skipton and Ripon (Mr. Watson) found, I believe, resonance in the House, and it is right that that reservation should be emphasised at the end of the debate. Restricting the ability of the trade marks registry to react quickly to applications for registration impairs the registry's efficiency. There is no doubt, especially because of the evidence given to the House by my hon. Friend the Minister, that the delay largely occurs because of the Treasury's consistent attitude in restricting the ability of the trade marks registry to recruit the staff necessary to


perform its proper function. The Government used that argument during the last Parliament to oppose the principle of the Bill, and the residue of that argument remains.
The Treasury is restricting the numbers of civil servants who can be recruited into the trade marks registry, and that impairs the efficiency of trade marks registration. We run the risk that that restriction will impair the registry's efficiency in responding to the wishes of the House on the registration of service marks. This measure will not mean increasing public expenditure, because the cost of recruiting each additional civil servant into the trade marks registry will be more than covered by the registration fees paid by people taking advantage of the registry's services.
A strong argument must be made that the Treasury should look again at its attitude to the resources that it is prepared to allow to the trade marks registry to ensure efficient operation in registering trade marks under the Trade Marks At 1938 and under the principles in this Bill. My hon. Friend the Member for Skipton and Ripon laid great stress on that. I hope that the Bill will commend itself to the House, and even to the Treasury so that it provides the resources necessary to allow the wishes of the House to be carried out.

Question put and agreed to.

Bill accordingly read the Third time, and passed.

Agriculture (Amendment) Bill

As amended (in the Standing Committee), considered.

Mr. Edward Leigh: I beg to move, That the Bill be now read the Third time.
It is a proud moment for me that the Bill has reached this stage, because, although it is modest in its extent, it will be of great benefit to agriculture, especially in helping new businesses to come into operation. The Bill amends the Agriculture Act 1967 to enable grants to be made in respect of a wider range of co-operative marketing businesses. It amends also the Agricultural Statistics Act 1979 to enable my right hon. Friend the Minister of Agriculture, Fisheries and Food to obtain more information on land ownership. It also repeals the power of entry and inspection.
It might be helpful if I were to make a short review of the present position so that the House might have some background information to my measure. The effect of the 1967 legislation is to give powers to the Minister of Agriculture, Fisheries and Food to pay grants in respect of guarantees for a bank loan to an agricultural or horticultural business. The present arrangements cover about 370 guarantees on loans of about £9 million. They allow creditworthy farmers and growers lacking the necessary collateral access to bank loans to develop their businesses. I am sure that the House agrees that that is important.
In 1964, the original scheme for Government-supported loan guarantees was introduced. At that time, the scheme was confined to horticultural businesses. In 1965 it was extended to include agriculture — at first under the Appropriation Acts, and then consolidated under the Agriculture Act 1967, which my Bill seeks to amend. Provision was made for the qualifying period to be extended for periods of up to five years by orders made by the Minister, subject to the Treasury's approval. The arrangements are operative through the Agricultural Credit Corporation, a company set up by the National Farmers Unions of Great Britain and Northern Ireland. For its services the corporation charges a fee of up to 2·5 per cent. a year of the sum guaranteed.
The matter of a payment from Goverment funds arises only —I stress this—if the borrower fails to repay the loan and the bank claims on the corporation as guarantor under the guarantee arrangements. My hon. Friend the Parliamentary Secretary may seek to catch your eye later, Mr. Deputy Speaker, to give the financial aspects of the Bill. Those aspects are modest. I stress that the loan is called in only if someone defaults.
The Government's contribution to the arrangement is kept under regular review. The Government have agreed to meet a maximum of 80 per cent. of any loan in default. The bank bears 5 per cent. of the loss, and the corporation the remaining 15 per cent. I stress again that the financial aspects of the Bill are modest, because, since the scheme began, 927 guarantees have been given, covering almost £16 million. The important point is that defaults are very rare. So far, there have been only 53 out of 927, with total grant payments of just over £500,000. I believe that the House would agree that that is a credit to the care exercised on those guarantees by the ACC's officials.
Loan guarantees for co-operatives are covered under the scheme. In 1972 an arrangement for marketing groups


was introduced. My Bill deals with the co-operatives and widening the scope of the original legislation. On those aspects of the scheme, the co-operative development division of Food from Britain, which was formerly called the Central Council for Agricultural and Horticultural Co-operation, works in close collaboration with the Ministry. In appropriate cases, and on the recommendation of Food from Britain, the Ministry pays the ACC's fees.
It may be useful to the House if I answer a few questions that are sometimes asked about the scheme. What type of borrower does the scheme primarily help? It helps those who, although creditworthy, lack the necessary collateral to offer security for a normal bank loan. A typical example would be a young progressive tenant farmer in his early farming years who is anxious to expand but lacks the necessary funds. The difficulty of young farmers in entering the business is a matter of great anxiety to hon. Members who represent agricultural constituencies. Any measure that can help them by ensuring that the Government provide the collateral rather than use their own resources will be welcome.
The scheme is also available to help farmers and growers with approved development plans and provides a means to assist marketing co-operatives. I shall explain later how more complex co-operatives have been developing in agriculture.
Is the scheme of particular benefit to tenant farmers? About 75 per cent. of existing guarantees relate to tenant farmers. Owner-occupiers have sources of finance from mortgage loans from the Agriculture Mortgage Corporation secured on property, but those loans are not available to tenant farmers.
The Bill deals primarily with co-operatives. What are the special arrangements for them? Since 1972 the Ministry has been operating a scheme by which marketing co-operatives, which cannot borrow as much as they need because as new organisations they have not yet established an adequate record of operations or because of insufficient collateral can obtain a loan guarantee from the Agricultural Credit Corporation without having to pay the fee. To qualify, a marketing co-operative must satisfy Food from Britain and the guaranteeing body that its proposition is sound. I stress again that the ACC takes great care to ensure that.

Mr. Greg Knight: We live in an age of wine lakes, butter mountains and outrageously subsidised food being sent to the USSR. There was a report in today's Daily Mail alleging that some farmers may be hoarding food. Will co-operatives be able to use these guarantees to finance expansion of products that are already in surplus? If that were so, I would have serious doubts about supporting the Bill.

Mr. Leigh: My hon. Friend raises a wide and interesting point. It would be tempting for me to digress at length on the nature of the surpluses that are built up in dairying. My hon. Friend will be aware that the House has been much exercised recently about how the Government in particular and the EEC in general can ensure the reduction of surpluses of dairy products——

Mr. Deputy Speaker (Mr. Harold Walker): Order. I hope that the hon. Member will not do what he suggested a few minutes ago it might be inappropriate to do.

Mr. Leigh: I shall try to bring this point rapidly to a close, because I recognise, Mr. Deputy Speaker, that it might lead to a much wider debate.
I do not believe that my modest measure will add to the surpluses in the dairy sector, because I stress that until now the measure has been concerned primarily to help new farmers and co-operatives. I do not believe that they are the people who are producing the surpluses. Much as I should like to develop my hon. Friend's theme, I had better not.
The ACC fees are then paid by the Ministry of Agriculture, Fisheries and Food. About £2 million-worth of co-operative guarantees have been approved through that mechanism since the scheme began. At present there are only four co-operative schemes with those guarantees, totalling about £300,000.
The House may ask whether the 2 to 2·5 per cent. fee charged by the guarantor discourages many farmers from applying. This is not a free scheme, but it is surely not unfair to ask borrowers to meet the costs of the scheme that provides the credit that they cannot normally obtain. The ACC needs the fee to cover its administrative costs and part of the risk that it carries. As any expense is admissible for tax purposes, the effective cost for many farmers and growers is reduced.
The House may also wish to know whether the need for such guarantees shows that the Government are failing to ensure a sufficient return for the industry. I do not believe that to be the case. The relatively modest number of applications suggests that most farmers have no difficulty in obtaining sufficient credit for their needs. There is no evidence that the banks and other credit institutions are unable or unwilling to play their part in providing capital.
I believe that Government support is adequate. Up to £300,000 per annum is available to meet the claims for grants, plus any unspent balance from the previous year up to a maximum of £600,000. As grant of only just over £500,000 has had to be paid since the scheme started, I am satisfied, and I hope that the House will be, that the provision adequately supports the guarantees already given and those likely to be granted in the extension period.
What criteria are used to decide whether to guarantee a loan? The ACC is mainly interested in ensuring that the borrower will be able to service the loan and the capital repayments. When an application is received, the farm is visited and the project for which the loan is required is discussed and assessed, usually in consultation with the applicant's advisers and his bank manager.
Hon. Members may ask why agricultural borrowing has to be so high. I hope that we can avoid extending the debate too far in that direction. The growth in borrowing is best seen against a perspective of the growth in asset values, including land. On average, the ratio of total external liabilities of about one fifth for tenanted farms and one tenth for owner-occupied farms and mixed tenure farms remains satisfactory.
As the Bill concerns the ACC in such detail, it might be helpful if I gave the House a brief description of it. It was set up in 1959 by the National Farmers Unions of Great Britain and Northern Ireland to assist suitable farmers and growers and the co-operatives to obtain fixed-term overdraft loans which would be repayable over periods of up to 12 years. The corporation gave the bank


a guarantee indemnifying it against a loss arising from default on the loan. As the House will be aware, that is a central part of the Bill.
In turn, the corporation reinsured itself through the National Farmers Union Mutual Insurance Society. By the end of 1962, the losses on defaults had proved higher than expected, and the National Farmers Union Mutual Insurance Society refused to accept fresh commitments. In those circumstances, the corporation was unable to secure underwriting cover from other sources and was forced to suspend the offering of guarantees, although existing commitments were and are still being honoured.
When the Government-backed scheme for horticultural guarantees was introduced in 1964, a new corporation, Farming Loan Guarantees Limited, was formed and took over all the ACC's existing business. The corporation was then reconstituted to handle those guarantees with Government support. It subsequently assumed responsibility for Government-backed agricultural guarantees as well. FLG no longer accepts new business. Only three FLG guarantees exist, all privately insured through the National Farmers Union Mutual Insurance Society. There is no liability in that respect for Government monies.
The ACC was incorporated on 30 July 1964 as a company limited by guarantee. Its directors are appointed by the parent organisation, the NFU Development Company, and it derives its income from the 2 to 2·5 per cent. guarantee fee to which I have referred.
The present chairman is Lord Stodart of Leaston. I hope that I shall be forgiven for going into the background of the Bill in some detail. However, it is important that the House should understand its provisions.
Clause 1 enables grants to be made to persons fulfilling guarantees in respect of bank loans to a wider range of co-operative marketing businesses than is permitted by section 64(2) of the Agriculture Act 1967 as extended by the Grants for Guarantees of Bank Loan (Extension of Period) Order 1984. It extends the present definitions of "co-operative marketing business" and "co-operative association" to include properties which have as their members other co-operative associations, or associations of co-operative associations, and not only those which act directly on behalf of their producer members. The House will recognise that co-operative associations are becoming more and more complex. That explains why the Bill is necessary.
Subsection (1) amends section 64 of the 1967 Act by the insertion of subsection (8A). The new subsection provides that for the purpose of definitions of "co-operative marketing businesses" and "co-operative association" in section 64(8) of the 1967 Act, members of an agricultural co-operative association which is itself a member of another such association are deemed also to be members of that other association.

Mr. Deputy Speaker: Order. I remind the hon. Gentleman that this is the Bill's Third Reading and not its Second Reading. It is not usual to go into the detail of the Bill again on Third Reading.

Mr. Leigh: I shall bring my remarks on the detail of the Bill to a close. I shall try to keep my remaining remarks as general as possible.
The Bill recognises that since the 1967 Act came into force co-operative marketing businesses have evolved into

much more complex structures which give rise to second-tier co-operative associations. These bodies usually have as their members original lower or first-tier co-operative marketing associations, which exist to market the produce grown by individual farmers or growers, but may include large-scale individual producers in their own right. As cooperative marketing associations develop to meet the continually changing demands of the market place, third or even fourth-tier organisations may be created.
The provision of loan guarantees has enabled a number of agricultural co-operatives to benefit from bank loans in the early days following formation, when they may have insufficient collateral security to attract a loan in the normal course of business. Similar circumstances may apply to a co-operative with more than one tier of membership. The Bill will place such a co-operative on a similar footing to the simpler associations in respect of guarantees.
Section 64 of the 1967 Act empowers the Minister of Agriculture, Fisheries and Food, with the approval of the Treasury, to make a grant in respect of expenditure incurred in fulfilling a guarantee given as security for a loan made in the course of a banking business to a person requiring the loan for the purposes of an agricultural or horticultural business carried on by him where the guarantee was given during the period of three years beginning on 1 April 1966. This enables grants to be made by the Minister to a person guaranteeing a bank loan to an agricultural or horticultural business in the event of a default and where the guarantee is called in.
The second part of the Bill bears little relation to the first part. That is the nature of a miscellaneous provisions Bill. However, I shall briefly set out the principles that lie behind the second part.

Mr. Deputy Speaker: Order. I remind the hon. Gentleman that we are debating whether the Bill should receive a Third Reading. I have a duty to protect the interests of the House and those of other hon. Members who are anxious to discuss their Bills.

Mr. Leigh: I shall explain briefly, without going into detail, the principles that lie behind the second part of the Bill. It is important because——

Mr. Deputy Speaker: Order. The appropriate time to discuss the principles underlying a Bill is on Second Reading. I hope that the hon. Gentleman will bear in mind that other hon. Members' business is on the Order Paper and is set down for consideration this day.

Mr. Leigh: I shall be brief, Mr. Deputy Speaker.
Under the Agricultural Statistics Act 1979, statistical surveys and an annual census of occupiers of agricultural land have been carried out which have provided data which have been used extensively by Government, industry and the European Community. In 1979, Lord Northfield's committee of inquiry was set up to examine recent trends in agricultural land acquisition. It was critical of the usefulness and scope of the information collected on land ownership and occupancy. It considered that more detailed information was needed on the terms on which agricultural land was occupied and on the pattern of ownership and occupancy to enable proper policy decisions to be taken. It considered that the effects of the policy decisions should be monitored.
The Act does not contain the necessary powers to enable those questions to be asked about the family


relationship between any one of the occupiers and any one of the owners or shareholders in the case of a private company, or the beneficiaries in the case of a trust. The Bill will allow questions to be asked about the terms on which and the arrangements under which the land is occupied, managed or farmed by any person.
This is a modest measure that will allow a wider range of co-operative associations to obtain guarantees and a wider range of information to be obtained by the Government, as recommended by Lord Northfield. I hope that the House will consider that it deserves a Third Reading.

The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mrs. Peggy Fenner): I congratulate my hon. Friend the Member for Gainsborough and Horncastle (Mr. Leigh) on piloting his Bill through the House to its consideration on Third Reading. He referred to the Bill as a modest measure, but the Government congratulate him on achieving his place in the Ballot and on being able to set down a private Member's Bill.
We support the Bill, for it will provide a welcome addition to our support for co-operatives. Since 1967, Government have actively encouraged the development, promotion and co-ordination of co-operatives. My hon. Friend referred to the organisation which has been incorporated in Food from Britain, which was called the Central Council for Agricultural and Horticultural Cooperation. Since 1982 the functions of that body have been part of the organisation called Food From Britain. Its task has been to secure an improvement in the marketing of agricultural and horticultural goods.
The co-operative activity of Food from Britain remains an important part of the organisation's overall activities. Its staff continue to assist and support in other ways, both by establishing co-operatives and by helping them to identify markets. It has set out its own priorities to aid marketing, which are directly concerned with marketing the goods and produce of the co-operatives.
Although it started only in 1982, Food from Britain set up an operational plan last October carrying it up to 1985. It has also set out its priorities in terms of United Kingdom commodities. The list includes many horticultural commodities, such as pot plants, as well as produce such as apples, and so on. The intention is to improve the standards and marketing of those commodities not just in the United Kingdom but in the export market. The four areas selected as priorities for export marketing are Benelux, France, Germany and the United States. To ensure that that objective is effectively carried out, overseas representatives have already been appointed in Benelux, France and Germany and negotiations are in train for a Food from Britain representative in the United States.
The wider objectives of idenifying the markets and encouraging consistency of supply and quality are also an integral part of producers' ambitions. That is their motive for getting together in co-operatives and the Bill will make an additional contribution to that. Before joining together into the larger co-operatives to which the Bill relates, the producers may already have been supplying overseas markets direct. For instance, first-tier producers in my home county of Kent supply the German market with good quality celery and strawberries.
The Bill extends the facility to guarantee loans already available to individual producers coming together in a first-tier co-operative. That availability has been assured by the recent passage of a statutory instrument to extend the loan guarantee provision for first-tier co-operatives for a further five years. The Bill will ensure that those co-operatives can form even more subsantial co-operatives to market goods both at home and abroad. Having extended the original facility for five years, it is right that the larger groups should enjoy similar benefits. The Bill will take the availability a step further to higher tiers of farming groups.
Food from Britain also plays a part in advising Ministers on the worthiness of applications by cooperatives for loan guarantees. That is an important means of ensuring the creditworthiness of the co-operative, the validity of its programme and its long-term financial viability.
My hon. Friend the Member for Derby, North (Mr. Knight) expressed concern about surpluses. He will have gathered from my comments so far that the loans are for marketing co-operatives and cover the storage, preparation and marketing, but not the production, of the goods. They will thus not add to surpluses but will improve the availability of outlets for the produce. I do not wish to wander into areas which you, Mr. Deputy Speaker, would rule out of order, but I assure my hon. Friend that the current common agricultural policy discussions involve strict rules about providing any funds to extend support for milk. I shall not go into that today, but I wish to reassure my hon. Friend that the guarantees covered relate not to production but to marketing and the improvement of outlets.
I shall not repeat the points already made about cost, save to say that under the 1967 Act Parliament provided that the Minister might pay up to £300,000 in any one year in support of guarantees, to which could be added money unspent in previous years, up to a maximum of £600,000. Those sums, to which Parliament agreed 17 years ago, should be considered in the light of the cost to the Exchequer in real terms, which has been just over £500,000 in the entire period since 1967 for grants on guarantees amounting to £16 million.
My hon. Friend the Member for Gainsborough and Horncastle referred to the 32 marketing co-operatives which have been assisted by loan guarantees involving a total of around £2 million. It is clear that it has been an extremely worthwhile system. In the past few years there has been a growth in the number of co-operatives that market what Britain produces so beautifully. We have been rather slower than some of our European competitors to market our produce well. That is why, before Food from Britain was established, the Ministry assisted the marketing of our wonderful Cox's orange pippin apples, for example, through the Kingdom apple scheme, which has now been extended to include Bramleys and Russets. I shall try not to incur your wrath, Mr. Deputy Speaker, by going on about various products, but I am only rarely able to mention my own county of Kent.
The Bill extends support for marketing co-operatives. We already have experience of the help, such as is to be found in clause 1, which is given to producers to form first-tier co-operatives. I congratulate my hon. Friend on trying to ensure growth in the number of second-tier cooperatives. He referred to the Northfield committee, which examined recent trends in agricultural land acquisition. The report was critical of the usefulness and


scope of information on land ownership and occupancy. We are mindful of that and welcome my hon. Friend's use of the opportunity to take extra powers to acquire such statistics.

Mr. Leigh: Will my hon. Friend explain why voluntary surveys cannot be used?

Mrs. Fenner: I was about to say that present legislation does not give us authority to ask the types of question that Lord Northfield clearly felt would provide us with more useful statistics. With regard to why voluntary surveys would not be sufficient, a small pilot study showed that, with a postal questionnaire in a voluntary survey, the response rate was too low. Only about 60 per cent. responded, and they covered only 53 per cent. of land. That was unsatisfactory.
The Agricultural Holdings Bill is intended to halt the decline in the number of tenancies in farming. It will be impossible to measure its effect unless we have accurate statistics on tenanted land. It is therefore all the more important that we have extra powers to ask questions about types of tenure, the relationship between occupier and owner and different type of owners.
It might be asked whether we shall add such questions to the June census, which is the Ministry's major source of collecting statistics and which is extremely valuable and much used. It might be possible to add one or two simple questions to that census, but types of ownership and occupancy are detailed matters which call for more detailed studies that are directed to occupiers and to owners and their agents, where necessary.
This is an important addition to the armoury of statistics collection. We do not feel it right to ask more questions in the census, but there will be specific surveys. In the light of the great concern that was expressed, first, by Lord Northfield and his committee of inquiry, and, secondly, by hon. Members on both sides of the House, and which led to the introduction of the Agriculture Holdings Bill, such information is necessary to ensure an improvement in the opportunities available to tenant farmers.
I hope that I have fully supported my hon. Friend's Bill, on which I congratulate him again. He said that it was a modest Bill, but it is an extremely valuable addition to improving marketing and statistical knowledge on tenant farming and related matters. Another small, but important, part of the Bill gets rid of one power of entry, and my hon. Friend will know that it is the Government's objective to dispense with those powers as far as is humanly possible.
The need for better marketing of our home-grown agricultural and horticultural produce has been widely recognised, and the setting up of Food from Britain is a major contribution towards meeting that need. Part of the strategy is the encouragement of co-operation. The Bill is a small but useful step in that direction. Given the way in which the guarantee scheme has been administered, and the considerable skill and expertise which is evidenced throughout the co-operative movement, I am confident that any additional Government expenditure that may be incurred through this small extension of the scheme can be contained within the limits set by Parliament.

Question put and agreed to.

Bill accordingly read the Third time, and passed.

Cycle Tracks Bill

Order for Second Reading read.

Mr. Cecil Franks: I beg to move, That the Bill be now read a Second time.
During the past decade the number of cyclists has increased annually, reversing the steady decline in the years before 1974. Sadly, as cyclists have increased, so have cycling accidents. In 1982 alone about 300 cyclists were killed and 5,700 seriously injured, and 30 per cent. of the victims were aged under 15. Hon. Members should bear those horrifying statistics in mind when considering the Bill. Cyclists are vulnerable in traffic, and one way to help them is to provide separate cycle tracks either alongside or away from roads. The Bill addresses itself to the provision and protection of such cycle tracks.
Governments of both parties have recognised the need to take account of cyclists. In 1982, following wide consultation on future cycling policy, my right hon. Friend the Member for Guildford (Mr. Howell), the former Secretary of State for Transport, and my right hon. and learned Friend who is now the Minister for Health published a cycling policy statement containing a wide range of policies aimed at encouraging more and safer cycling. Those policies have been implemented under the watchful eye of my hon. Friend the Minister of State, Department of Transport, and in implementing them she has had the support of many hon. Members on both sides of the House
The cycling policy statement identified three areas where legislative change was desirable: first, to control the parking and driving of motor vehicles on cycle tracks; secondly, to simplify the procedures for converting all or part of a footpath to a cycle track; and thirdly, to give highway authorities the power to erect barriers on cycle tracks that are not alongside road carriageways.
Hon. Members with greater experience than me will be aware that such simply stated proposals can, when all aspects have been considered, result in some complex legislative drafting. That is true of the Bill, and so to assist the House I propose to go through it clause by clause to spell out exactly what it modestly seeks to achieve.
Clause 1(1) amends the definition of a cycle track in section 329 of the Highways Act 1980 so that in future mopeds will be excluded from new cycle tracks. Mopeds with pedals are legally classified as pedal cycles, yet they have a far higher speed than the pedal cycle, and where they have used cycle facilities they have been the cause of a serious contribution to the number of accidents on them. In Stevenage, for example, where cycle paths were designed for joint use by pedal cycles and mopeds, in a five-year period mopeds were involved in 82 of the 98 injury accidents reported to the police.
There will be many locations where the use of cycle tracks by mopeds will be objected to on environmental as well as safety grounds. While mopeds can currently be excluded from cycle tracks by making individual traffic regulation orders, it is appropriate to provide a specific prohibition. Clause 1(2) clarifies the position so that mopeds are also excluded from existing cycle tracks.
Clause 1 does not apply to electrically assisted bicycles, which are also classified as pedal cycles. Their speed is intended to be broadly compatible with that of a pedal cycle and, of course, there are few currently on the roads.
Should problems emerge with such bicycles, highway authorities will be able to exclude them from cycle tracks by making a traffic regulation order.
Clause 2(1) makes it an offence to drive or park a motor vehicle, wholly or partly, on a cycle track, and sets a maximum fine on the third level of the standard scale, which from 1 May will be set at £400. At present, unless there is a traffic regulation order or a local byelaw, it is not an offence to drive or park a motor vehicle on a cycle track. The presence of motor vehicles on cycle tracks is, at the least, an inconvenience, and at worst, a serious danger to cyclists. There was very strong support for this change in the responses to the cycling policy consultation paper which my right hon. Friend the Member for Guildford and my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) issued in 1981.
Clause 2(2) provides a defence if the motor vehicle is being used in an emergency, or is engaged in work on behalf of the highway authority or by a statutory undertaker. Clause 2(3) defines statutory undertakers as including sewerage authorities and British Telecom. Clause 2(4) provides a defence if a motor vehicle is being driven on a cycle track if that is the most reasonable means of obtaining access to, or egress from, premises.
I deal next with clause 3. At present, to convert an existing footpath to a cycle track involves five procedures. First, it involves obtaining planning permission for a "new" cycle track. Secondly, it involves using that planning permission to obtain an order under the Town and Country Planning Act 1971 to "stop up" the existing footpath. Thirdly, it involves making a compulsory purchase order, if necessary. Fourthly, it involves "constructing" the new cycle track. Fifthly, it involves making a traffic regulation order to ban motor vehicles from that track.
Those procedures are complicated and time-consuming. While objections can be made at many points during them, there is only a limited prospect of independent assessment of the conversion as a whole. Clause 3 is intended to simplify the procedures for converting all, or part, of a footpath to a cycle track. However, it is also intended that the position of objectors to such conversions should be strengthened, with provision for an independent assessment when there are unwritten or unwithdrawn objections.
Hon. Members will agree that the most appropriate way of improving conditions for cyclists is on the carriageway itself. Failing that, specific alternative provisions for cyclists should be considered. It is only if such provision is impractical that the possibility of sharing existing pedestrian-only facilities can be examined. In short, shared pedestrian-cyclist use should primarily be a cycle safety measure of last resort.
I am aware that my hon. Friend the Minister has been giving careful consideration to shared facilities. I am also aware of the particular concerns of the blind and partially-sighted people, which have been conveyed to me by representatives of the Royal National Institute for the Blind.
Clause 3(1) will enable a highway authority to designate by order a footpath or part of it as a cycle track, with a right of way on pedal cycle but not on mopeds, and a continuing right of way on foot. Thus, a single order will replace the existing complex procedures.
Subsections (2) and (3) give the Secretary of State powers to make regulations in respect of the procedures to

be followed when orders are being made, including regulations relating to the publication of any proposed order, the making and consideration of objections to such proposals and the publication of the making of an order. They can also cover the holding of a public inquiry, the appointment of an inspector and the modification of an order before it is made.
Subsections (4), (5) and (6) provide for the legal validity of an order to be challenged in the High Court within six weeks of the date of publication of the notice making an order. It also sets down the powers of the High Court to suspend the operation of, and, on final judgment, to quash, a defective order either in whole or in part. No other legal challenge can be made to an order. The subsections reflect the usual provisions applied to such orders.
Clause 3(7) allows the highway authority, under equivalent procedures, to revoke an order made by it under clause 3(1), with the cycle track reverting to a footpath. The power to revoke is essential, as it must be a basic principle of shared use that the use of such facilities should be monitored and that they should be taken out if they are not found to work.
Clause 3(8) gives the highway authority power to undertake the necessary work to give effect to an order and any work that would constitute development under the planning Acts is deemed to have been given planning permission.
Clause 3(9) obliges regulations made by the Secretary of State under the clause to be subject to the negative resolution procedure.
I should mention the two amendments that have been suggested, which I am prepared to accept. Clause 3 has been drafted on the basis that a local authority will propose making a footpath conversion order, that there should be a right of objection to such an order, and that unwithdrawn objections should be considered by an independent inspector, who would then report to the local authority which, having considered his report, either would not proceed with the order or would make it, with or without modification. Those procedures are based on those applied to traffic regulation orders.
When discussing the Bill with interested bodies, it has been suggested that shared use of footpaths is very different in concept from a traffic regulation order. When considering shared use, we are asking for a clear decision to be made between the possibility of improving cycle safety and the risk of inconveniencing, and possibly endangering, pedestrians.
The principle of shared use of a particular footpath can be questioned, as can the sort of shared facility that is proposed; whether there is to be some form of barrier or kerb between the pedestrian and the cycle parts of the facility, or a white line, or unsegregated sharing. I know that my hon. Friend's Department has prepared a comprehensive consultation paper on shared use and is finalising its advice to local authorities on the subject.
It has been suggested that, bearing in mind the nature of the safety judgment and decision that needs to be made, the inspector should report to the Secretary of State and not to the highway authority. Those who are concerned about the principle and practice of shared use see this as an additional safeguard. I know that my colleagues in local government will not take it amiss if I say that it could help them to avoid possible conflicts of interest. I accept these arguments, and having discussed them with my hon.


Friend the Minister I know that she accepts as well that this is the best way to consider objections on this difficult subject. The appropriate amendments to clause 3 can be considered in Committee.
One other amendment that has been considered to clause 3 merits support. As drafted, the clause gives the highway authority power to convert any footpath, including those rural footpaths that cross farmers' fields. Footpath conversion is seen as a safety measure for cyclists that is likely to be of greatest use in urban areas or on those clearly defined rural footpaths that run outside fields and link, for example, a village with its school. While the clause can be used to provide a recreational facility, that is not its primary purpose and we should provide an additional safeguard by prohibiting conversion of footpaths through agricultural land unless the consent of the landowner has been given. Again, an appropriate amendment can be considered in Committee.
On shared facility, barriers may be desirable to separate cyclists from pedestrians, to reduce the speed of cyclists and to exclude motor vehicles. Legal advice is that highway authorities do not have the power to erect or maintain barriers on cycle tracks that are not within the boundary of a highway that also comprises a carriageway. Responses to the cycling policy consultation paper support an extension of these powers.
Where a cycle track is adjacent to a footpath or footway, works that do not amount to a barrier, rail or fence may be desired to segregate the two ways. They may be no more than a hump on the boundary between a cycle track and the adjoining footpath or footway just sufficient to show the boundary between the two and encourage the cyclists to remain on the cycle track. Such works, together with tactile markings to signify the start of a shared facility, should also assist the blind pedestrian on the footpath or the footway.
Clause 4(1) allows highway authorities to provide and maintain barriers on any cycle tracks. Clause 4(2) allows highway authorities to undertake whatever work they think necessary in the interests of safety to separate persons using the cycle tracks from those using an adjacent footpath or footway. Clause 4(3) allows highway authorities to alter or remove any barriers or other works provided under this clause. Clause 4(4) defines, for the purpose of this clause, a cycle track, a footpath and a footway.
Because of their concern over certain forms of shared use, specifically white line segregation and unsegregated sharing, the RNIB has suggested that the Bill should be amended to ensure that the pedestrian and cycle paths on shared facilities should be of adequate dimensions and that there should always be segregation by some form of barrier. The effect of its proposals would be to prohibit shared use unless sufficient space was available to provide a barrier.
I understand the RNIB' s concern, but I feel that there are likely to be locations where white line or unsegregated sharing can work well and improve safety without endangering or inconveniencing pedestrians. I am thinking especially of the shared facilities provided on footpaths alongside some rural main roads which safely carry heavy flows of child cyclists to and from school. I think that highway authorities should have the full range of alternative forms of shared use available to them, always

bearing in mind the advice of the Department of Transport on such facilities and, of course, the strengthened right to object to footpath conversions proposed in clause 3.
Clause 5 covers compensation. Under the existing conversion procedures there are rights to claim compensation for any compulsory acquisition of land or of an interest in land where the use of a new cycle track which did not involve acquisition of an interest in land can also merit compensation under part I of the Land Compensation Act 1973.
Although there is no experience of claims arising under existing procedures, it is considered appropriate to give the right to claim compensation for the consequences of the new procedures proposed in clause 3 and the execution of works in either clause 3 or clause 4.
Clause 5(1) gives a right to recover compensation for damage consequent on the undertaking of work under clause 3(8), to give effect to a conversion order, or, under clause 4, the erection of barriers or works.
Clause 5(2) gives a right to claim compensation for any reduction in the value of an interest in land arising as a consequence of the coming into operation of an order made under clause 3, but it excludes claims which can be made or anticipated under clause 5(1).
Clause 5(3) refers disputes to the Lands Tribunal, linked to section 307 of the Highways Act 1980.
Clause 6 extends the Bill to cover land owned or managed by the Crown based on similar provisions contained in the Highways Act 1980. The remaining clauses, clauses 7 to 9, cover expenses, interpretation, and the short title, commencement and extent of the legislation.
I must apologise for the length and detail of my explanation of the Bill's provisions. I hope that it has helped to clarify the detailed provisions that it contains. I believe that the Bill will make a useful and valuable contribution to improving the safety of cyclists, while ensuring that the interests of others are protected. I commend the Bill to the House.

Mr. Gerald Bermingham: I congratulate the hon. Member for Barrow and Furness (Mr. Franks) on the introduction of his Bill, which I agree is an excellent step forward in the provision of safety and protection for the cyclist. It has long been the feeling of many of us that as we move slowly towards a more leisured society the bicycle will come back into its own. Those of us who are old enough to have cycled in the 1940s and 1950s remember from boyhood the fun that cycling was, especially those of us fortunate enough to live on the edge of a rural area.
It is against that background that we should consider the Bill and its contents and the way in which it can help towards making cycling once again a sport that is safe, enjoyable and, in its own way, assisted by the Government.
There are certain other features which might have been contained in the Bill, and perhaps I may be allowed to commend them to the Minister. If we are to encourage the use of bicycles in the manner suggested by the Bill—and it will be an encouragement—at the same time we must extend the training available to young cyclists. I hope that the Minister agrees with me about the need to train young cyclists.
Some years ago, when I was a member of a city council in the north of England, one of the committees on which I served dealt with road safety and particularly with the safety of young children. Cycling proficiency tests and schemes have been established by various bodies and they are a great help, particularly to children, for it is crucial not only to learn how to ride a bicycle but how to ride it safely. It is all too easy to come to grief on a cycle because there is nothing between the rider and the object that is hit, and the road accident statistics show the tragic loss of life and permanent injury that result from such accidents. I hope, therefore, that the Government will take kindly to my plea that we spend a little more on the training of cyclists.

The Minister of State, Department of Transport (Mrs. Lynda Chalker): indicated assent.

Mr. Bermingham: I welcome the Minister's indication of agreement. Children enjoying the countryside is one thing. Children enjoying it safely is more beneficial to all.
Moving away from training—having included a plug for some Government expenditure in that respect — I come to the Bill, which I welcome, though not in its entirety, and hope that some suggestions that I have will be heeded. The Bill sets out to create more cycle ways. A cycle track is a place where a cyclist can travel in safety, away from the danger of motorised vehicles.
I welcome in particular the acknowledgement at long last in motoring law that a moped is not a cycle. Those who over the years have had experience of appearing in courts in cases connected with mopeds know how great a danger they can be if they become entangled with cyclists. A number of tragic accidents have occurred, particularly to young children, when mopeds have been found in places which were meant for cyclists. Those who construct mopeds might have a greater eye to the safety of their construction, and perhaps the House can discuss that on another occasion.
As it is proposed that there should in some cases be tracks containing cyclists and pedestrians, I have reservations about the Bill in that respect. On my way to the House on Wednesday, walking from my flat in London, I was nearly mown down by cyclists coming up on the pavement behind me. That reminded me of the dangers of intermingling pedestrians and cyclists. There is much point, therefore, in the argument of the Royal National Institute for the Blind. If we allow the two to be near each other, there must be a segregating feature, not only for the blind but especially for small children using the footpaths.
It has been suggested that there might be a curb to sector the area. In my view, that would be the minimum solution, and I should not be happy simply with white lines, which are meaningless to the blind and are ignored to a large extent by young children who have not yet acquired the safety techniques, so to speak, of being with traffic.

Mr. Franks: I understand the argument, which is much in the mind of those in the Department of Transport. I hope that in the reasonably near future the anxieties expressed by the blind will be satisfied.

Mr. Bermingham: That intervention reassures me. If the Department insists upon shared use with anything less

than a visible and tangible barrier the hon. Gentleman will have my support in fighting that decision. Physical separation is the only safe method.
The hon. Member said that he was prepared to consider amendments to the Bill. I hope that I misunderstood what he said about rural footpaths. One of the joys of cycling is getting out of the urban areas into the rural areas and the national parks. Other attractive areas are being developed under schemes such as Operation Groundwork on Merseyside.
To enjoy certain rural environments one must travel across agricultural land. Many rural footpaths pass through private and public land. I should be disappointed if such footpaths could not be used by cyclists because they had not been designated as cycle tracks.
I hope that I misheard what the hon. Gentleman said about landowners' consent. Landowners may be reluctant for cyclists to use paths even though they do not do damage.

Mr. Franks: I have explained that the purpose of the Bill is primarily to provide for the safety of cyclists. It is not intended to be a recreational or leisure exercise. Justified representations have been made by the National Farmers Union which believes that the Bill could enable local authorities to make footpaths through agricultural land into cycle tracks to the detriment of the farmer. The Bill is not intended to do that. One must strike a balance between the needs of the farmer and the desires of pedestrians and cyclists.

Mr. Bermingham: I am grateful to the hon. Gentleman for that clarification. No one would argue that a narrow path through a plot of land on which crops are grown should be turned into a cycle track. I accept that unreservedly. However, I urge the hon. Gentleman to bear in mind that many footpaths cross areas of great natural beauty. The same problem is not encountered when a path crosses moorlands, for instance. Such areas should be opened up to the cyclist so that he can explore and enjoy the rural environment. I have in mind the Peak national park and moorlands or wooded areas. I do not expect cycle tracks to be created in the middle of agricultural fields primarily designed to grow wheat, potatoes or other edible crops.
I understand the NFU's worries about cycle tracks on arable land, but a case can nevertheless be made to permit cycle tracks in areas of great national beauty—primarily moorland, wooded areas, and so on. Certain estate roads could be divided to provide cycle tracks.
Clause 3 provides for an expedited application system. I welcome it because it will improve the previously cumbersome procedures that had to be followed.
I shall be almost a devil's advocate on behalf of the objector, who has a right to be heard. His ultimate sanction is to apply under subsection (5) to the High Court. Such applications are expensive. We have an extensive system of Crown courts, but county court judges make able judgments, and the county court system might provide a better forum for dealing with this matter. As a lawyer, who always turns his mind to the question of costs, I believe that the costs would then be considerably lower. The hon. Member for Barrow and Furness might take this matter on board in Committee.
Regrettably, clause 9 limits the provisions of the legislation to England and Wales. I hope that at some stage they will be extended to Scotland, an area of great natural beauty in which many people enjoy themselves.

Mrs. Chalker: What about the hills?

Mr. Bermingham: I note that the Minister worries about the hills. I thought that it was the order of the day for politicians to climb hills, so hills would be no deterrent to them.
This is a good Bill, although some small improvements could be made to it. I hope that the hon. Gentleman will consider the points made about the cost of proceeding in the county courts and shared use of cycle tracks. I do not believe that any hon. Member would wish to see the Bill defeated or its passage hindered. I am sure that, by discussion, we can overcome the problems. In the end, all being well, we will have increased the safety of the cyclists on our roads and the availability of the areas in which they can enjoy themselves. That will add to our society's quality of life, and that is no bad thing.

Mr. Kenneth Hind: It is appropriate that I follow the hon. Member for St. Helens, South (Mr. Bermingham), as we represent adjacent areas in Lancashire and Merseyside. Those areas have in common the fact that they are extremely flat and accessible to cyclists. My constituency contains vast tracts of rural land, and many cyclists from all over the country are attracted to it to enjoy their sport at weekends. On Monday 9 April the annual Sealink cycle race will start in my constituency at Skelmersdale and continue across the rural areas of Lancashire towards the coastline.
That shows that cycling is growing as a sport and as a means of transport in difficult times, such as during the London Transport strike this week. My hon. Friend the Minister led the way by cycling to her office on that day to avoid traffic problems. Cycling has a great future as a means of transport and exercise. I am in favour of anything that will encourage people to go to the country and enjoy it sensibly and respect its rights and beauties. The Bill gives a classic opportunity to enjoy the country in that way.
I welcome the Bill, as I am sure do most hon. Members. It covers different aspects of cycling. The first is the safety aspect. Parliament has recognised over and over again the seriousness of the number of cyclists killed on our roads. Fortunately, nowadays far more cyclists wear luminous clothing in the dark, which draws attention to them and helps avoid accidents. However, there are still too many accidents on our roads.
The Bill gives vital encouragement to the development of cycle tracks. If local authorities use the opportunity provided by the Bill, many cyclists will be taken off the main roads and will use cycle tracks. The safety aspect of the Bill cannot be under-estimated. It will save lives and encourage people to feel safe and free to take their cycles on to the roads. Children are restrained from going into the country because of the dangers presented by heavy traffic on narrow lanes. The Bill will help encourage children to use their bicycles.
The initiative of my hon. Friend the Member for Barrow and Furness (Mr. Franks) takes account of the

views expressed in the 1981 cycling policy consultation paper. It is important that hon. Members should be seen to respond to the views of the public as expressed through such consultations.
The Bill gives local authorities the opportunity to develop their cycle tracks. I welcome the ease with which clause 3 will enable them to do so. It sweeps away the difficulties that were formerly put in their way. I wonder how many local authorities did not develop such facilities because of those difficulties.
The hon. Member for St. Helens, South mentioned the legal costs of overcoming the difficulties. I am a member of the Bar, and it is important that both sides of the legal profession should be represented in the argument. I invite my hon. Friend the Member for Barrow and Furness to reconsider using the High Court to deal with appeals. County courts and Crown courts with highly competent judges are available to deal with appeals, because cost is an important consideration for the public and for local authorities. We must keep an eye on ratepayers' money spent on such matters. My hon. Friend will find it easier to establish a quick and efficient system of dealing with such matters in the county or Crown court, rather than in the High Court. I commend that suggestion as a sensible way to deal with the problem.

Mr. Harry Greenway: Does my hon. Friend agree that cyclists are under-funded from the rates? Cyclists pay rates like everyone else but they, of all sections of the community, receive especially low returns for their money. The Bill will go some way towards providing facilities for them in line with what they are paying. They are making the same contribution as that made by all other sections of the community.

Mr. Hind: I am grateful to my hon. Friend for that intervention. Cyclists do not receive the benefits from public expenditure that are enjoyed by users of other forms of transport. I hope that the House will welcome the Bill as a sign that we are committed to the development of cycling as a form of transport.
It is important to consider the costs of transport in future. There will be a reduction in North sea oil supplies, and as the world oil supply is depleted we may see an increase in transport costs. We have not yet invented an efficient battery-powered car as a substitute for the petrol engine. It is important to remember that two legs were invented before the engine and that they provide a most efficient way of travelling.
It is important that we take advantage of the opportunity presented by my hon. Friend the Member for Barrow and Furness. If the Bill is enacted, it is estimated that it will cost initially about £500,000 a year. No doubt there will be difficulties with the Treasury, but it appears that the economy is beginning to grow. It appears that even the Bank of England is now accepting that the economy will grow at the rate of 3 per cent., and it appears that Britain is getting back on the rails. I hope that my hon. Friend the Minister of State will have discussions with her Treasury colleagues to ensure that money is made available for the sort of expenditure that would take place following the Bill's enactment.
From the point of view of many of my constituents and of those who represent rural areas, this is a good Bill. It is a progressive step in the right direction, and I welcome it.

Mr. Simon Hughes: I, too, welcome the Bill. I apologise to the hon. Member for Barrow and Furness (Mr. Franks) for not being in the Chamber when he moved the Second Reading. On my way to the Chamber from the Norman Shaw building I was nearly bowled over by joggers as I walked through the underpass. I was worried slightly because the joggers were moving rather faster than many cyclists on the roads.
It is interesting to observe that all those who have contributed to the debate come from the north-west. The Minister of State also represents a part of the north-west. Perhaps the north-west will be the campaign hot seat for ensuring that cycling receives the additional support and encouragement that it deserves. I have no doubt that that support and encouragement will bring many advantages.
My recent experience of cycling has been in the capital. I used to take a route which took me via Hyde park corner, past Buckingham palace and along the Embankment to the Temple. It was a route which was full of incident. I am happy to say that I travelled along it regularly in safety. It was enhanced when it became possible to use Hyde park instead of using the main road as it enabled me to escape, for about five or 10 minutes, the risk of being squashed between the kerb and articulated vehicles, or squashed between the kerb and slightly less large vehicles and covered in spray.
There are many hazards with which cyclists have to contend. The largest group of hazards is presented by motorised transport. The second largest group is potholes and unexpected obstacles in the road. Unless the cyclist is holding the handlebars carefully, he can be dislodged by the impact, or the items that he is carrying can be dislodged. A series of difficulties is presented when other road users do not know that the route that a cyclist is following has been designated for cyclists.
It is important to put the matter into context. Where cycle tracks have been provided they have clearly been successful and there have been very few accidents to either pedestrians or cyclists. A survey of the 14 busiest cycle ways carried out by the Transport and Road Research Laboratory showed that between 1979 and 1981 there was only one accident involving a cyclist and a pedestrian. In the three years since then, so far as I know, no accidents have been reported involving cyclists and pedestrians on the cycle ways in Hyde park. Those figures show how much safer it is to move cyclists off the roads to clearly defined cycle tracks segregated from pedestrians.

Mr. Peter Bottomley: Does the hon. Gentleman agree that when, unfortunately, accidents occur, those involving a cyclist and a pedestrian are far less dangerous than those involving a cyclist and a heavy vehicle?

Mr. Hughes: That is certainly true. On the road, if one falls off or is knocked off one's bicycle, or even if one is unsettled by a pothole, the risk of being run over or into carries a great deal more risk of injury than if one falls on a cycle track or, more probably, on to the grass beside it.
Nevertheless, the accident rate for cyclists on roads is still very high. I have received figures on this from the London Cycling Campaign, which is based in my constituency. I must therefore declare a constituency interest in that cycling is alive and well in north Southwark and wanting to be more clearly seen in the inner city and

elsewhere, The Minister will no doubt confirm that there are still between 4,000 and 5,000 cycling casualities each year. That must be in the minds of the Minister and the Department — I know that it is — as an important objective to deal with and a motive for fully supporting the Bill and making it as effective as possible.
The great advantages of the Bill are as follows. Clause 1 would take mopeds and other motorised transport off cycle tracks, which will remove many problems for cyclists. I hope, however, that the Depertment will encourage local authorities to take more care to provide within their bounderies areas for the recreational use of motorised two-wheeled vehicles. Many youngsters begin with small push bikes and BMXs, for example, and go on to motorised vehicles, which they often ride on private property such as council estates before they are legally entitled to take them on the road, with the result that pensioners may be in considerable danger. On many estates there are complaints that kids with bicyles, mopeds and motor bikes use the footpaths in a way that is not compatible with pedestrian use, especially pedestrian use by the elderly and others less able to protect themselves.
In encouraging the use of two-wheeled transport, we must ensure that the recreational and learning value as well as the safety aspect are encouraged in areas such as parks and industrial areas that are ripe for development. In my area, Surrey docks includes plenty of land where youngsters could learn to ride motor cycles and perhaps even cars rather than occasionally being tempted to break into them illegally and take away cars that they should not have. That would provide considerable recreational opportunities.
The Bill states clearly that mopeds cannot be used on cycle tracks. I hope that this will lead to encouregement from the Government and local authorities for the creation of other areas to accommodate motorised two-wheeled transport with the associated recreational learning value for youngsters.
Clause 2 provides appropriate penalties for those who trespass on cycle tracks. That is good, because, having created such tracks, nothing is worse than having something in the way which could cause an accident. The great advantage of clause 3 is the flexibility that it encourages, as it provides easier mechanisms for the provision of cycle tracks. Local authorities must be able to be flexible. Some cycle tracks in Southwark are probably not the best routes and the local authority will have to consider whether there is a better alternative. There ought to be a quick method of designating an alternative route if the traffic flow makes the former unsatisfactory. Clause 3 makes that much simpler.
Clause 4 provides the opportunity for segregating pedestrians from cyclists. The hon. Member for St. Helens, South (Mr. Bermingham) rightly advanced the case of the handicapped, especially the visually handicapped, who should, whenever possible, have clearly segregated routes. That is possible in rural areas and by main roads as there is sufficient space, but it is not so easy in urban areas. It is nevertheless important for pedstrians, especially blind people, to know that they will not be confronted by a cyclist who may reasonably be going quite quickly on the wrong path. It is also important to encourage the use of traffic signals that allow people adequate time to cross. There is an excellent crossing near the Elephant and Castle where the cycle path crosses the


main road from Kennington. Cyclists are given time to cross, but pedestrians sometimes do not have enough time to cross the cycle track. That affects elderly and disabled pedestrians most. They should be protected against any risk of accident.
I do not know why all those who have spoken so far are lawyers—perhaps they represent a substantial proportion of the cycling population — but it is right that we provide the easiest and cheapest court procedure for all of the challengers. I hope that such an improvement can be made in Committee.
It would be to Britain's advantage if the helpful encouragement that has been given to cyclists and potential cyclists was increased. That would be of service to the environment as pollution, congestion and the costs of private and public transport would be reduced. We should do everything possible to improve recreational opportunities by giving every support to the cycling lobby and community. Anyone who has used a bicycle regularly will find that it is often the most efficient and, in London, quickest means of getting from A to B. It is only when the mountains are at their highest and the hills are at their steepest that we wonder whether we should have chosen another form of transport.
I hope that the Bill will be supported and that it is just one of many measures that bring about a change in financial support and other methods by which to advance the cause of cycling. My impression is that, bearing in mind the flatness of some of the country, regular, as opposed to recreational, use of the bicycle is not fully exploited. It is obvious that we shall never rival the Belgians or the Dutch, but we must encourage cyclists as that would benefit the entire community. I wish the Bill a speedy passage to the statute book and hope that it is the first of many such measures.

Mr. Harry Greenway: I am pleased to be the first non-lawyer to take part in the debate. I congratulate my hon. Friend the Member for Barrow and Furness (Mr. Franks) on presenting this admirable Bill and hope that the House will forgive me if I do not stay for the entire debate; I have a constituency engagement. I look forward to the increased provision for cyclists which the London borough of Ealing envisages is possible under the Bill. I hope that there will be greater provision for cyclists all over London, because by their nature cyclists do not restrict themselves to boroughs or areas.
Perhaps my hon. Friend and my hon. Friend the Minister of State will take on board some positive suggestions. Could the Bill include a provision to encourage motorists to be more aware of cyclists whom they must pass, especially in relation to the driving test? The man who tested me told me that I nearly failed my driving test because I did not give adequate room to the first cyclist that I passed, although subsequently I did give enough clearance to cyclists. I cycle regularly in London and I am a member of the all-party cycling group in the House. I am often alarmed by the lack of room given to cyclists by motorists, especially by the drivers of juggernauts. Lorries are so long and wide that, especially in narrow streets, cyclists can be flattened against the kerb. Once or twice I have had to jump off my bicycle and get on to the pavement just to get away from a lorry. The

Minister is a regular cyclist in London and a treasured member of the all-party cycling group, and I should be glad to hear her sympathetic response to that suggestions.
Hon. Members have mentioned the need for safe cycling. The cyclist has a responsibility to ensure that he knows the rules of the road, that he gives clear signals and that he keeps as close to the kerb as is reasonable. It is also important to keep the roads clear of potholes. The GLC has signally failed to do that in London, and cyclists are battered round terribly on streets not far from here.
We must do something while children are at school to ensure that each child who wishes to cycle to school passes the cycling proficiency test first. I had a rule in my last school and in other schools where I worked of not allowing children to bring their bicycles to school unless they took and passed the cycling proficiency test. I conducted regular tests, and the children knew that they could sit tests at least once a week. I also sent letters to their parents so that they would know that the facility was available. It is important that children should start cycling safely at an early age. One thing that city children especially enjoy is receiving a new bicycle. In the schools where I worked many children whose parents were fairly hard up managed to receive new chopper bicycles. Cycling was often their only recreation. Once they get bikes, children must learn to ride them safely, and they need facilities other than the pavement. Cycling tracks would be welcome, and the Bill takes us very much in that direction.
There must be areas other than Hyde park where we could have near dual use of facilities. The cycle track in Hyde park was mentioned by the hon. Member for Southwark and Bermondsey (Mr. Hughes) and by my hon. Friend the Member for Barrow and Furness. I was in Hyde park this morning and had the pleasure of galloping a horse alongside cyclists who were using the cycle tracks. Indeed, the horse overtook several of them, and it was not going flat out either. The Army regularly uses the riding track in Hyde park, and other people take the air or use Hyde park for recreational purposes, walking alongside the cycle track that my children have used purely for pleasure, but which others may use as a means of getting to work.
This morning many people were cycling through the park on their way to work, and I should have thought that the principle could be extended to national parks and other areas. I do not see why it should not be. It would be nice if horses, cyclists, pedestrians and hikers could have reasonable use of the same facilities, while at the same time having regard for the safety of all, as that is important and needs to be thought about.
I regret that Members of Parliament no longer travel by horseback to work. Just a week ago, at the memorial service for that great man the Duke of Beaufort, I met a gentleman who said that he was the nephew of the last Member of Parliament to ride to work. He travelled to Parliament by horseback until 1942, and I was told where the horse was tethered. Indeed, the tethering rings still remain.
The facilities formerly available in Parliament to horse riders have now been turned over to cyclists, and it is good to see row upon row of cycle racks in the precincts of Westminster. It shows that hon. Members realise the value of fresh air and of the exercise achieved through cycling. Anything that can advance such values is to be welcomed, and I warmly support the Bill.

Mr. Greg Knight: I have no interest to declare, and I feel rather like a member of "athletes anonymous", in that if any of my colleagues are feeling energetic I usually talk them out of it. Nevertheless, I welcome the Bill, and I know that it will also be welcomed by many of my constituents, particularly the members and supporters of the Derby cycling group and the Cyclists Touring Club.
I support the Bill basically for two reasons. First, cycling is growing in popularity, so it is only right that we should see that proper provision is made for it. Secondly, the present procedure for converting a footpath into a cycle track is extremely complex and militates against many local authorities making provision even though they may be considering doing so. I understand that one needs to obtain planning permission for a cycle track, first, under the Town and Country Planning Acts. Secondly, planning permission is needed to stop up the existing footpath. A cycle track then has to be constructed under the Highways Act 1980, and often that may involve having to issue a compulsory purchase order. Local authorities have to follow a tortuous and complex procedure. Therefore, I welcome clause 3, which I believe amends the Highways Act to allow a local authority to convert a footpath into a cycle track in one step, without the additional need to apply for planning permission. That is most welcome.
Several hon. Members have spoken of the need to educate cyclists. However, if any road user needs to be educated it is not primarily the cyclist or motorist, but rather the pedestrian. I hope that in due course pedestrians will pay a little more attention to the needs of other road users. I fear that that may not be the case unless we eventually introduce a system similar to that in continental countries, where pedestrians are sometimes prosecuted for jaywalking.
I accept that that is a debate suitable for another occasion, but some of the criticism levelled against cyclists is unjust. Quite often, if anyone is to blame for an accident, it is the pedestrian who walks into the road or across a cycle way wholly oblivious of the fact that others may be using it.
This is an overdue measure. I support and welcome it, and I hope that the House will give it a Second Reading today.

Mr. Peter Bottomley: It is important to recognise that we owe a duty to travellers to make them as safe as possible. Cyclists, like pedestrians, are in great danger from motor cars and lorries. The experience of those of us who cycle and who are not yet members of "athletes anonymous" have recognised the value of the cycle tracks that have been introduced. If my hon. Friend the Member for Derby, North (Mr. Knight) wishes to join the House of Commons football team this Sunday, perhaps he will have a word with me later behind the Chair.
The experience of cyclists has been one of growing danger. The amount of traffic on London's bridges has risen by 50 per cent. during the past 10 years. That is a demonstration of the increased number of vehicle miles. As the number of cyclists has also grown during the past 10 years, there is an increased danger all round.
There was a time when the movement for cycle tracks was seen as a fringe enthusiasm. That has changed. My

experience in cycling around London is that it is slightly less dangerous than travelling on a moped, but still highly dangerous. All hon. Members will have experienced sadness and sorrow when they hear of children having been killed and adults having cycle accidents.
The improvements suggested by the Bill of making it easier to have cycle tracks enacted and to cut away some of the bureaucracy presently associated with that will encourage more local authorities to press ahead with the good ideas that are being argued for by the various cyclist groups and those concerned with road safety.
At the same time, we must mention the responsibility of cyclists to take measures towards greater safety. I remember that when I was growing up and cycling it was rare to see a cycle without lights at night. During the past few years, there has been a growing tendency for lights to be absent from bicycles or, if they are present, not to be used. One reason for that is the increased amount of vandalism and petty theft which has made it more risky for people to leave lamps on parked cycles. Indeed, it is risky to leave a cycle almost anywhere because we often see a frame chained to a lamp-post with its wheels removed.
It is important for people to have respect for other people's safety. They should be willing to change society so that it will again be safe to leave a lamp on a cycle. We should perhaps encourage the police to pay rather more attention to cycles without lights.

The Under-Secretary of State for Health and Social Security (Mr. John Patten): Hear, hear.

Mr. Bottomley: I am glad that my hon. Friend the Minister is gracing the debate with his presence. He like me, wants to reduce the cost of accidents to the National Health Service and to reduce the number of avoidable accidents.
The concept of cycle tracks should be spread. Obviously, different provision is needed for the countryside and for the towns and cities. In the countryside, it will be possible to allow cycles on some footpaths where they are currently not allowed. In the towns, it is more a matter of separation from the roads. It would be sensible for all those involved as cyclists or in the cycle manufacturing industry—which has a vested interest in ensuring greater opportunity for safe cycling — to get together with local authorities to encourage them to make use of the Bill when it becomes law.
The job of local authorities is not an easy one. 'They have conflicting priorities. If it becomes easier for them to say yes to something that is eminently sensible, they are likely to respond more to the campaigns of those who want to reduce the number of accidents and the toll of injury and death on the roads, and to make it possible for cyclists to go about their lawful travelling in a way that is consistent with the greatest possible safety.
I look forward to the day when it is possible for people to make journeys of a reasonable length in greater comparative safety. No form of travelling can be made perfectly safe, but in promoting this Bill my hon. Friend the Member for Barrow and Furness has made it possible for Parliament to respond to the need with a non-controversial helpful measure and to get the support of the Government so that local authorities can be of more service to those who want to travel in their areas.

Mr. Colin Moynihan: Hon. Members may know the words of Lord Randolph Churchill 100 years ago in a speech on a financial report in Liverpool—a topical subject—when he said that Mr. Gladstone,
for the purpose of recreation has selected the felling of trees, and we may usefully remark that his amusements, like his politics, are essentially destructive … The forest laments in order that Mr. Gladstone may perspire.
I note that my hon. Friend the Minister, whose intellectual ability is highly renowned and matched only by his interest in this important subject, knows the speech well. The words that I have quoted may reasonably be translated 100 years later as saying that, for the purpose of recreation and safety, my hon. Friend the Member for Barrow and Furness (Mr. Franks) has selected cycle tracks, and we may usefully remark that his amusements, like his politics, are essentially constructive. The forests — indeed, the woodlands and countryside — will celebrate so that my hon. Friend may perspire. They, along with hon. Members and all involved in cycling, should celebrate this private Member's Bill because it serves to assist all those who seek high safety standards in all recreational facilities, including many who hold this view in the London borough of Lewisham, and in my constituency in particular.
The popularity of cycling is well known to hon. Members. Some 30 per cent. of households now have bicycles. Cycling is a cheap and efficient method of travel, and it is enjoyable and healthy. To the particular advantage of hon. Members, it is a quiet pursuit that does not pollute the atmosphere. Today, to offer relief from boredom for those in an increasingly leisure-oriented society, it is important to encourage cycling. This Bill matches that development by encouraging high levels of safety for all involved in cycling. Much time and energy of the Sports Council, of which I am a member, is directed towards finding ways and means of co-operating on facilities for recreation and safety, and as Members of Parliament we should encourage that.
It is important to recognise that the words of my hon. Friend the Minister responsible for sport are still valid. He said:
I am anxious to increase opportunities for all people to participate in sport and recreation, individually or as a family or a local community." — [Official Report, 22 July 1983; Vol. 46, c. 251.]
Many new facilities have been provided in recent years and since 1979 the Government have substantially increased spending through the Sports Council and other programmes. We shall maintain that commitment.
This Bill matches such expansion of recreational facilities with increased safety for participants. My hon. Friend the Member for Barrow and Furness recognises that in this Bill, which seeks to increase the safety of cycle tracks and footways and footways adjacent to cycle tracks.
It is important to recollect that in part—and in my view it is a major part—this initiative came out of a number of consultation documents, not the least of which was an important consultation paper on cycling, published, I seem to recall, by the Department of Transport and the Welsh Office in 1981. That said:
In an ideal world we could solve many of these problems by giving cyclists their own tracks, separating them from other users of the roads.

In that context, we must always have in mind the special difficulties of the disabled and the blind.
But there is not enough space and not enough money to do this everywhere. Nevertheless, within the resources available for transport, the Government will continue to take positive action to meet the needs of cyclists … The Government can help cyclists in the following ways: first, by providing and encouraging the provision of facilities for cyclists; second"—
and most important, in my view—
by helping to make cycling safer; and, third, by promoting legislation to help cyclists and to protect their interests.
Clause 1 goes yet a stage further, and, overall, the Bill should be welcomed by the Government as a development of all three of those intentions outlined in the consultation paper on cycling in 1981.
I want for a moment to concentrate on clause 2. It is all too easy for accidents to happen where byelaws are not in situ, where the law is not clear and where the definition of exactly what cycle tracks are and where they should be is not clearly evident. I was pleased to hear the point made by my hon. Friend the Member for Lancashire, West (Mr. Hind). Those who ride will be aware of the dangerous driving and other problems which result in an appallingly high level of accidents. It should not be under-estimated or played down, because there are far too many accidents. The Bill recognises that, and I hope that this debate will put it on the map. The Bill is drafted to tackle that problem, and we should not fail to voice our concern about the incredibly high level of appalling accidents, not only in our cities but in rural areas, as a result of cycling errors, bad driving and the lack of demarcation of exactly what can be done by what type of vehicle and where.
It is important to concentrate on the provisions in clause 2. It proposes to make it an offence to drive or to park a motor vehicle on a cycle track, with exemptions for emergency, public utility and maintenance vehicles as well as for access to any adjacent property with no other approach. The penalties envisaged are rightly related to those for existing parking and obstruction offences. There was strong support for such a change in the responses to the consultation paper since, as I understand it, under present arrangements it is an offence only if there is a traffic regulation order or a local byelaw to that effect. The key to this issue, obviously, is safety.
At the very heart of the Bill, clause 3 has enormous relevance. I congratulate my hon. Friend on the work that he has done to highlight clause 3 and on the way that it is worded. It is the most significant clause in the Bill.
In practice, where we really move forward in road safety terms is the proposal to simplify the present complex procedures for converting existing footpaths to cycle tracks while retaining the right of way on foot. At present, an authority has to obtain permission for a new track, to stop up the existing footpath and then to create the track, together with the possible need for both a compulsory purchase order and a traffic regulation order. This proposal provides the opportunity for objections at several stages. At present, there is only a limited prospect of an independent assessment of a conversion scheme.
The Bill proposes that, subject to procedural regulations governing advertising, consultation, objections and inquiries, all of which must be considered, the highway authority should have the specific power to convert part or all of an existing footpath to a cycle track and to reverse that step. Simplification here will encourage recreation and the pursuit of cycling.
The thinking behind the clause goes to the heart of increased recreation with minimal bureaucratic intervention and increased safety, greatly simplifying the implementation of such studies as that entitled "Study of Disused Railways in England and Wales" — critical bedtime reading for all interested in how Britain's cycle tracks should and could be developed. That outstandingly good publication identified some of the complexities involved, for one cannot just say, "We will identify this and that pathway for the use of cyclists." It is a highly complex matter.
Referring to a beautiful part of the country—Penrith —that study said:
An idealised cycle route running through an urban area on relatively quiet residential and minor roads would have to cross a major road about every kilometre. Many of these roads would require a signal controlled crossing according to the criteria illustrated … It would clearly be prohibitive to build such a protected network in its entirety in a short time period. By the same token most cycle routes in urban areas involve stretches of road or crossings which are potentially dangerous, particularly so for children and inexperienced cyclists. Similar considerations apply to routes extending into rural areas where the potential minor road network is still dissected by primary roads. The great attraction of a disused railway lies in the fact that it cuts across all of this, it provides a route separated from the traffic, and because it is unique (i.e. its location cannot be altered) it provides a core, or a spine, to act as the basis for subsequent development of a more detailed network of cycle routes. Without the railway, or some other 'obvious' route, as a catalyst it is often difficult to get started at all because of the problems associated with every route.
That shows how complex it is to identify cycle routes. The complexity over the years has built up into such an appallingly difficult state — including a tremendous number of byelaws and an enormous procedural network —that at the end of the day it damages cyclists. That is why I support the clarification that has resulted from our discussion of the Bill and has been espoused at length, and rightly so, by my hon. Friend the Member for Barrow and Furness.
The Bill is to be welcomed because it simplifies many of the issues involved and greatly enhances the safety of the participants of this recreation, and does so at minimal cost. When it comes to safety, we should consider even high cost. There is nothing more important than the safety of the individual. However, where safety can be achieved at much lower cost, as envisaged by the Bill, all power to the elbow of those proposing such a scheme. The cost here is so low that it should receive our immediate investment for the safety of cyclists.
I can do no better than emphasise again the remarks of my hon. Friend the Member for Barrow and Furness, for if every point that I have made must come second to one other, it should be the safety of cyclists. Let that safety lead many more to share the sentiments of Jonathon Swift, who loved
to begin a journey on Sundays, because I shall have the prayers of the church to preserve all that travel by land".
That applies as much to the cyclists of today as to the pedestrians of the past. The Bill has my whole-hearted support.

The Minister of State, Department of Transport (Mrs. Lynda Chalker): As a cycle-friendly Minister, I congratulate my hon. Friend the Member for Barrow and Furness (Mr. Franks) on the presentation of his most useful Bill. I am grateful to hon. Members of all parties for their

support for the measure. We shall have suggestions to make in Committee, but I hope that the Bill will be given a fair wind.
The Bill is supported by the Friends of the Earth, various cycling groups and by all who have taken the trouble to understand why it is so necessary to have on the statute book a measure to provide for cycle tracks.
As my hon. Friend the Member for Barrow and Furness said, the measures in the Bill stem from the proposals contained in the cycling policy statement issued in January 1982 by my right hon. Friend the Member for Guildford (Mr. Howell) and my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke), who were then Ministers in the Department. Hon. Members will know that we are implementing the policies in that statement. The Bill is most helpful in that respect.
In case anyone should think otherwise, the Bill, as clause 3 clearly states, is confined to footpaths. Many people do not realise that the official terminology for pavement is footway. The path at the side of the road is a footway and is not affected by the Bill. There is no provision for the shared use of footways. Footways continue to be covered by the Highways Act.

Mr. Bottomley: Do the same bureaucratic complications apply to providing cycle tracks on footways, or whatever are the opposite to the paths provided for in the Bill?

Mrs. Chalker: The Highways Act provides special safeguards for footways—that is, the pavements at the side of roads—and it is sensible that they should be continued. In the Bill we seek to make provision for cycle tracks along footpaths and to get rid of bureaucracy in that respect.
We have encouraged local authorities to provide facilities for cyclists, and we have been considering cyclists' needs in our trunk road proposals. Local authorities have been much aided by the Manpower Services Commission's railway path project and have been converting disused railway lines for cycle and pedestrian use, as my hon. Friend the Member for Lewisham, East (Mr. Moynihan) said. They have converted 226 miles, and more conversions are in hand.
My Department's programme of innovatory cycle schemes continues to expand, and in January I announced our research programme into cycle routes in five towns — Canterbury, Stockton, Exeter, Bedford and Nottingham. We hope to start implementing two of the schemes, in Canterbury and Stockton, a little later this year. We shall soon see some progress from the schemes. We are monitoring them through the Transport and Road Research Laboratory, which will provide us with valuable information for the future.
The Pedal Cycle (Safety) Regulations 1984 seek to improve the standards of bicycles and to increase their conspicuity. Hon. Members have referred to lights on bicycles. My hon. Friend the Member for Eltham (Mr. Bottomley) made a point about that. I very much regret seeing, night after night, cyclists without properly functioning forward and rear lights on their bicycles. They do themselves no benefit. They put themselves and others in great danger. I hope that the cycling community will work with the Department to ensure that cyclists have properly functioning forward and rear lights, to provide for the safety of all.

Mr. Laurie Pavitt: Will the hon. Lady emphasise that that practice is even more dangerous when roads are wet and the light is in patches? Cyclists put their own lives and those of others at risk.

Mrs. Chalker: The hon. Gentleman is right. Parents have a responsibility to ensure that children's bicycles are in good order. All those factors are involved in making cycling safer.
In our safety publicity and in our work with the Royal Society for the Prevention of Accidents we continue to stress the need for continued cycle safety, especially for child cyclists. It is noteworthy that about 300,000 youngsters per annum are taking the national cycling proficiency scheme, and the hon. Member for St. Helens, South (Mr. Bermingham) is interested in that.

Mr. Bermingham: Does the Minister agree that, because of the number of accidents that are now occurring, the time has come when the quality, design and candlepower of the lights displayed on bicycles should be looked at again, especially bearing in mind the variations in lighting features in our cities and other urban areas?

Mrs. Chalker: The hon. Gentleman has a valuable point. The Department has been examining the problems caused by the batteries and bulbs in those sensitive lights. If the hon. Gentleman has, as I have, removable lights on his bicycle, he knows that from time to time they need more attention that the old dynamo-driven lights, which have gone out of fashion, partly because of what thieves do to them if they are left on bikes.
The Bill covers the major outstanding points from the 1982 policy statement and has the Government's support.
My hon. Friend the Member for Barrow and Furness cited the Stevenage accident figures. He showed clearly the desirability of excluding mopeds from cycle tracks, and every hon. Member who has spoken in the debate has supported that aim. I believe that making the prohibition general, so that the driving or parking of motor vehicles on cycle tracks is an offence, will not only increase the cyclists' safety and convenience but will lift from local authorities the onerous task of making individual traffic orders for each cycle track, which is a time-consuming business.
Many hon. Members and people outside the House are worried about the shared use of facilities by cyclists and pedestrians, and I agree that this is a difficult matter. In March last year my Department issued a consultation paper following a review of its advice on shared use. Almost all of those who commented on the advice recognised that shared use could contribute to cyclists' safety. Groups representing blind and partially sighted people and pedestrians have expressed worry about certain forms of sharing. Yesterday, I had a most useful meeting with members of the joint committee for the mobility of the blind and partially sighted, when we went into those measures in detail. I know that my hon. Friend the Member for Barrow and Furness has met those people, too.
The matters which those people put to my hon. Friend and myself are those of which we are only too well aware. We understand them and intend to introduce the best possible measures to facilitate the passage of the blind and partially sighted as pedestrians, and of cyclists, if there is any question of shared use. We have now completed our consideration of the comments that have come in, and I

am about to finalise the advice, which we shall put out to local authorities in the form of a local transport note. We shall take as much account as we can of all the comments made to us, consistent with giving clear advice to local authorities.
The advice will stress that shared use is to be an exceptional measure, to be considered only when there is no other way to improve cyclists' safety, and only when full consideration for pedestrians has also been taken into account. The need for careful survey and for wide consultation when considering such facilities will be stressed. I also intend to stress that the advice on shared use is likely to be inappropriate where there are facilities of limited width carrying heavy pedestrian flows or significant numbers of elderly, blind, disabled or young pedestrians.
The advice will clearly state that segregation by barrier or kerb is best, but that under strict circumstances white line segregation and unsegregated sharing is a last resort available to highway authorities. We can discuss that in greater detail. Such facilities, as the hon. Member for Southwark and Bermondsey (Mr. Hughes) said, have worked well in practice, and a review of the use of certain shared facilities is being undertaken by the Transport and Road Research Laboratory. It has not so far identified any major problems. It is a matter of detail, which I hope we can discuss further. The advice that we will send out will state that if shared use is found to be unacceptable in practice, it should be removed.
Hon. Members will be aware of the tactile surfaces that have been experimentally laid at a zebra crossing in Parliament square. Hon. Members will be interested to know that the TRRL is undertaking research into forms of tactile warnings to help blind and partially sighted people, in shared facilities which are not separated by a barrier or kerb, to know exactly where they are. In working that out, scientists are considering not just a surface which will be a marker to a blind or partially sighted person, but one which might also be an effective deterrent to the cycle user. That is a possibility. Initial tests have produced promising results, but I want to see further tests undertaken at specific sites to be sure of the efficacy of any of these measures. Clause 4 gives highway authorities the power to provide such facilities, and in that sense my hon. Friend the Member for Barrow and Furness has thought the matter through well.
When my hon. Friend referred to clause 3, he said that he proposed to accept some amendments. I agree that inspectors considering objections into footpath conversions should report to the Secretary of State. I shall offer my hon. Friend any assistance that he may need to draft amendments to make that a reality.
Hon. Members will have noted that clause 3 also gives the Secretary of State power to make regulations. We have had time to consider what those regulations could contain, and while we clearly need to consult widely on any draft regulations, it might help hon. Members if I were to indicate our current thinking.
We are considering asking my hon. Friend to include a requirement for prior consultation with the police, other local authorities responsible for the area, statutory undertakers whose land a footpath may cross and other interested organisations. That would be sensible. When consulting and advertising its intention to convert a footpath, a highway authority will have to indicate the length or lengths of footpath that it is proposed to convert,


the type of conversion that it is proposed to undertake and what segregation is intended between the cycle tracks and the remaining footpath, or whether, in the most exceptional cases, the whole footpath is intended to be a cycle track.
Representations and objections will be able to be made at the appropriate time both on and to the principle of converting the footpath and the type of shared use that the authority intends to provide. If unwithdrawn objections are received, they will be considered at a public inquiry before an independent inspector, who, if the Bill is amended as proposed, will report to the Secretary of State. I hope that that provision and my response to my hon. Friend the Member for Barrow and Furness will meet with the agreement of those who consider the Bill in Committee if, as I hope, it receives its Second Reading this afternoon.
A number of other matters have been raised by various hon. Members, including our band of lawyers, who led off the debate. It was said that appeals should go not to the High Court, as specified in the Bill, but to a Crown court or county court. I understand that this way of proceeding has not been used before in legislation. I accept the contention of the hon. Member for St. Helens, South (Mr. Bermingham) and others that there are many time-consuming procedures connected with the High Court and that they become extremely costly for the individuals involved and for local authorities. I am prepared to take some proper legal advice—I hope that the lawyers in the House will not misunderstand me—by consulting my right hon. and learned Friends the Attorney-General and the Solicitor-General to ensure that there would be no particular objection if "High Court" in clause 3(5) were amended to "county court" or "Crown court". If my hon. Friend the Member for Barrow and Furness is in agreement —I notice that he is indicating assent—I shall take up that matter between now and the Bill returning to the House, if it is given a Second Reading.
The hon. Member for St. Helens, South described the Bill as a good measure, and he went on to describe his unfortunate experience on Wednesday when he was trying to get about London, as I was, by bike. He commented on cyclists using footways—in other words, the pavement. Cycling on the pavement or footway is illegal, irrespective of the age of the cyclist. I know that a blind eye is sometimes turned when small children are riding their bicycles on the pavement, but it is an illegal activity and it is dangerous. This is why we need more cycle tracks, and the purpose of the Bill is to ensure that cyclists are able to cycle in safety, while leaving everyone else in safety.
Occasionally the enthusiasm of cyclists overcomes them and they do some crazy things on the road. On my travels about central London on Wednesday I saw things that I hate seeing cyclists doing. Some cyclists were weaving in and out between vehicles, while others were going almost on to the pavement at times to get across junctions instead of adhering to the rules of the road and obeying traffic lights. Cyclists do their fellow cyclists a great disservice by ignoring the highway code and the rules of the road. In addition, they put their own lives and safety in jeopardy, as well as the lives of others. If cyclists behave with more common sense and obey the rules of the road, we shall have fewer frustrated motorists, who tend to try to ease cyclists out.
My hon. Friend the Member for Ealing, North (Mr. Greenway) referred to large vehicles passing cyclists, which can be most unpleasant for the cyclist, especially

in wet weather. In trying to educate motor vehicle drivers to avoid cyclists, however, we should encourage cyclists to help themselves by not infuriating the drivers of four-wheeled vehicles, as they so frequently do, especially in rush hours, when there are no cycle tracks and the new route through Hyde Park cannot be used. I make a special plea to cyclists to obey the rules extremely carefully when cycle tracks are not available.
An important aspect of safety is respect for the pedestrian in all circumstances. Our roads have become ever busier, as my hon. Friend the Member for Eltham made clear in his reference to the vastly increased traffic over the bridges of central London. Unless cyclists respect pedestrians as well as drivers of four-wheeled vehicles, there will be a real problem. As my hon. Friend the Member for Derby, North (Mr. Knight) said, pedestrians must also think about what they are doing and not dash out in front of cyclists, assuming that a cyclist is going much more slowly than a four-wheeled vehicle. Many hon. Members present today are cyclists themselves and will no doubt confirm that pedestrians often do not realise how fast a cyclist can go and therefore jump in front of him, thus causing many problems, in addition to the possibility of the cyclist going into a pothole while his attention is distracted. We must be far more conscious of the need for every road user, on foot, on two wheels or on four wheels, to respect every other user.
Another safety problem which arises where there are no cycle tracks relates to the use of BMX bikes. As my hon. Friend the Member for Ealing, North said, children Love to receive bikes as presents and they are often the sole means of lone recreation. In the right place and the right circumstances that it is to be encouraged, but I urge parents and youngsters who hear of this debate to realise that where there are no cycle tracks and no separate BMX tracks in the local park, much more care must be taken by BMX riders than seems to be the case at present. Hon. Members frequently write to me expressing concern about the misuse of parks, especially in city areas, by youngsters riding these bikes in places where they should not be and in a manner calculated to cause real disruption to pedestrians. That, too, makes us conscious of the need for the Bill.
I very much liked the idea advanced by my hon. Friend the Member for Ealing, North, who said that when he was a headmaster children were allowed to cycle to school only if they had taken their cycling proficiency test. It is crucial that staff in our schools should encourage that. About 300,000 children take the Royal Society for the Prevention of Accidents course annually. I hope that that figure will rise by leaps and bounds. I believe that that can be achieved. With its "Think Bike" campaign, the Department is doing its best to improve cycling safety. We are also trying to ensure that child cycling becomes a good deal safer.
I assure the House that I share its hope that the Bill will help increase safety for cyclists, while safeguarding the interests of others. For those reasons I warmly welcome the Bill and urge the House to give it its full support so that we can have safer cycling.

Question put and agreed to.

Bill accordingly read a Second time and committed to a Standing Committee pursuant to Standing Order No. 42 (Committal of Bills).

Mr. Bottomley: On a point of order, Mr. Deputy Speaker. Earlier today we had a Division on the Third Reading of the Juries (Disqualification) Bill. I should like to know whether, when the Bill returns for consideration next week, it will still be debated, or whether there will just be an opportunity for another Division.

Mr. Deputy Speaker (Mr. Paul Dean): I cannot give the hon. Gentleman an answer off the cuff, but if he seeks advice I am sure that it will be readily available to him.

Private Members' Bills

GENERIC SUBSTITUTION (NATIONAL HEALTH SERVICE) BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday 6 July.

COMPANIES BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday 6 April.

LEASEHOLD (SCOTLAND) BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday 6 July.

TOBACCO PRODUCTS (CONTROL OF ADVERTISING, SPONSORSHIP AND SALES PROMOTION) BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday 6 July.

RIGHTS OF LONDONERS BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday 6 April.

SCOTTISH AFFAIRS

Ordered,
That the order of the House [8th December], That the matter of Electricity in Scotland Generation and Capacity be referred to the Scottish Grand Committee, be discharged.— [Mr. Garel-Jones.]

Official Referees

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Garel-Jones.]

Mr. Sydney Chapman: I am grateful for the opportunity to raise what I believe is a serious issue that affects the construction industry—the status and number of official referees. As you will know, Mr. Deputy Speaker, this is not a sporting matter or anything to do with football. Official referees are judges who deal with the majority of civil engineering and building disputes. I am delighted that my right hon. and learned Friend the Attorney-General is here to reply. His presence shows the importance that the Government attach to the issue.
You will know, Mr. Deputy Speaker, that there has recently been an increase in the importance of construction industry litigation. I have only to mention recent judgments such as Sparham-Souter, Anns v. Merton (LBC), and Pirelli to send a chill down the spine of builders, architects and local authorities and, no doubt, a thrill of assured employment for lawyers. I am not a lawyer. The increasing importance of the industry's litigation led to the setting up of the official referees users committee with, I understand, the approval of the Lord Chancellor at the end of 1982 to advise him on means by which to improve procedures.
The users committee includes representatives of, for example, the Royal Institute of British Architects, the Royal Institution of Chartered Surveyors, civil engineers' organisations, the Building Employers Confederation, the Federation of Master Builders, the National House Building Council, local authority associations and members of the legal profession. It might be appropriate for me to declare a possible interest as a non-practising architect and a non-executive director of a construction company.
Until recently there were only three official referees —Sir William Stabb, the senior official referee, Judge Hawser and Judge Newey — but because of the increasing work load, and after pressure from the legal profession and the construction industry, Judge Smout was appointed as a fourth official referee last July. The official referee courts deal with the majority of legal disputes and they involve claims of between £50,000 and £500,000. However, several claims are in excess of £500,000. In one extreme case that is down for hearing in 1985 the damages involved are about £4·5 million.
Due to the pressure of the volume of building litigation, some cases notified today are being set down for trial as late as 1987. That increased delay in dealing with litigation is the main but not the only problem that I shall bring to the attention of the House. In an excellent article in the magazine Building on 19 August last year, Miss Rhona Wyles, who is the head of the legal services of the National House Builders Council, identified the problem of delay and confirmed that the long delays were occurring
despite the fact that Official Referees adopt the practice of treble booking cases, ie each judge is allocated three cases to hear on the same day. This system works only if two out of the three cases settle before the trial date. Often this will happen, but if it does not, cases are adjourned — perhaps for months —because there is no judge to hear them.
Such delays can increase the costs of litigation as costs may have been incurred in preaparing for trial, some of which may have to be incurred again later. Another problem is that

sometimes cases estimated to last, say, two weeks are not finished in time. They are then adjourned, sometimes for as long as a year.
That puts in a nutshell the problem of the work load and the consequent delays.
In 1983, 140 cases were tried by the official referees. The average length of those cases was 12·5 days, while 59 cases were estimated to last more than three weeks. Cases brought before official referees are increasing in number and complexity, with the technological developments in the building industry, and increasing in value in the sense of the damages claimed, and on many occasions awarded.
To illustrate that, may I tell the House about three cases that are listed for trial before one official referee in May this year. They are estimated to last for more than three weeks, so doubtless the official referee will deal with other cases if he has the time. One case set down for 1 May is estimated to last for four to six weeks; another set down for 8 May is estimated to last for eight weeks; and the third, also set down for 8 May, is estimated to last for three weeks. I suggest that this is akin to trying to pour a gallon into a pint pot, and this at a time when the law on liability for latent defects in buildings is in a state of flux or, as some would say, in chaos.
I shall mention three cases in chronological order. To summarise the case of Sparham-Souter in 1976, the court held that a person was entitled to sue for up to six years after the date of discovery. In the case of Aims v Merton (LBC) in the following year, it was held that a person could sue up to six years from the health and safety of the occupier being threatened. That caused consternation in many local authority offices. More recently, the Pirelli case in 1982 overruled Sparham-Souter and held that a person could sue up to six years after the damage had occurred.
Of course I am aware, as the House will be, that the Lord Chancellor's law reform committee has been looking at the whole problem of the law of liability for latent defects, and we hope that it will report soon. Indeed, I think that that committee's report has been awaited with bated breath by local authorities and the construction industry since 1980. All that legal confusion may provide some comfort for lawyers, but it has bred considerable concern in the construction industry and extreme anxiety, among those affected. Delays in litigation affect not only large building companies or engineering concerns but, in a very real sense, ordinary householders.
I am told that concern about the unsatisfactory state of affairs is shared by the legal profession. I understand that 32 solicitors' firms representing the majority of such leading firms have expressed their interest in speeding up the whole process of building litigation. They point out that delays cause substantial prejudice to their clients. Large amounts of capital can be tied up. A building company facing damages of, say, £1 million would have to tie up that money for a considerable time even if it was subsequently successful in the court of the official referee. Many hon. Members may think, to adopt the old adage, that slow justice is indeed justice denied.
I invite my right hon. and learned Friend the Attorney-General to consider three suggesions—in other words. three things are required. First, at present there are four official referees and that number should be increased as a matter of urgency to six. I should like to think that the Lord Chancellor must have given that proposal of mine—although it did not come from my lips when he considered


it—tacit support, because he has allocated one circuit judge and one recorder to sit as deputy official referees. That is immensely helpful, but it is no substitute as a county court judge cannot become familiar with procedures in a business that has become very technical and technologically complicated in the past 20 years or so. Therefore, I hope that my right hon. and learned Friend will consider my first suggestion favourably.
Secondly, official referees should have High Court status. My right hon. and learned Friend will know that presently they enjoy only the status of circuit judges. They should have that heightened status because of the importance, complexity and value of the case that they are asked to determine.
I understand that there is a legal dimension. Official referees, by the very nature of their job, have to give authoritative judgments. It is essential that those judgments should be widely reported. I understand that, having only the status of circuit judges, official referees' judgments are not widely reported unless the cases go to the Court of Appeal. I am told further that not only are they not binding as legal precedents—perhaps my right hon. and learned Friend will touch on this point—but the whole matter concerns lawyers as well as the construction industry because they both need the greater access to official referee decisions so that the same points of law are not litigated time and again. Currently official referees have the jurisdiction and duties of a High Court judge, but they have only the status and salary of a circuit judge. Surely that cannot be right.
My third proposal is that official referees should have better court facilities. Many cases are international and have an international scope. Foreigners are sometimes quite amazed and disillusioned about the conditions that they find when they come to take part in such cases. We do not want foreigners, quite apart from anyone else, to be disillusioned about British justice.
I shall cite three cases that underline the inadequate facilities. In one case, 10 parties were involved and they were represented by no fewer than 23 barristers, not to mention the solicitors and other back-up staff. Because of the appalling lack of accommodation, I am told that the National Liberal Club's billard room had to be hired. I am sure that that is the most useful purpose to which that room has ever been put, but such a practice surely cannot be satisfactory.
Secondly, one official referee's court room can comfortably accommodate only six people. Thirdly, one court regularly used by an official referee in Kingsway, not far from here, until recently did not have even the facility of a telephone which, apart from anything else, is essential to enable members of the legal profession to take instructions.
I thank my right hon. and learned Friend for attending the debate. I appreciate his attendance very much. I hope that I have managed to persuade him, if persuasion be needs, that the issue is of public importance and affects the largest industry in Britain. The construction industry is the largest in the country, whether measured in terms of manpower or of output. Last year, in spite of the recession, the value of its output was no less than £22,000 million, and about 1 million people in the industry are directly affected. That excludes the hundreds of thousands of people who manufacture goods or provide services for the

industry. The construction industry's output represents 8 per cent. of the gross national product. From the legal aspect, this great industry is sorely discriminated against in the determination disputes. Surely it is also crucial that we should have a fairer and more expeditious way of dealing with building litigation if we are to uphold the quality of our system of justice and confidence in the law.

The Attorney-General (Sir Michael Havers): I am grateful to my hon. Friend the Member for Chipping Barnet (Mr. Chapman) for providing this opportunity to say something about an important part of the administration of justice, although clearly one about which not much is known. I know the difficulties of which my hon. Friend spoke, and I understand that the Whips were seeking to persuade my hon. Friend the Minister responsible for sport to respond to this debate. I know of the interest of my hon. Friend the Member for Chipping Barnet in this subject, and I have great sympathy with the problems about which he has spoken. I hope that in the course of my reply I shall be able to satisfy him on some of the points that he has raised.
A little more of the history of this historic job could appropriately be dealt with now. Ever since the 18th century matters of scientific or other specialist knowledge could be referred to an expert for report, and, under the Act of 1874, cases involving accounts could be referred to a master of the Supreme Court for report. Those represented two exceptions to the usual procedure that civil actions under the common law were tried by judge and jury.
There was much criticism of trial by jury as a method of dealing with building and other complicated cases, so the Act of 1873, which first established the unified High Court, extended and formalised the old arrangements of unofficial or special referees by creating the office of official referee. The first were appointed in 1881. At first their jurisdiction was only to investigate and report facts, or to try particular issues of fact that were referred to them, but the Act of 1884 provided that whole actions could be referred to them for trial and empowered them to give judgments and make orders—for example, orders for costs. However, until 1982 they remained referees in the sense that cases had to be referred to them by the High Court. They had no original jurisdiction. However, by virtue of a change in rules of court, which took effect on 1 October 1982, a plaintiff can mark his writ or originating summons with the words "official referees' business", and no further reference by the High Court is required. This is a time-saving change.
One other aspect of the background that I should mention is that the Royal Commission on assizes and quarter sessions — better known as the Beeching commission—recommended in 1969 that there should be only two categories of judge below the level of the Court of Appeal and that the official referees should belong to the lower category—the circuit judges. The title "official referee" was in fact abolished by the Courts Act 1971, although the designation "official referees' business" was kept to describe the kind of work they do, and the Lord Chancellor was given power to nominate particular circuit judges to deal with that work. As in everyday parlance the title "official referee" is still applied to judges so nominated, I shall go on calling them by that name.
The kind of work that the official referees do is loosely defined in the relevant rule of court as any case
which involves a prolonged examination of documents or accounts, or a technical, scientific or local investigation such as could more conveniently be conducted by an official referee; or for which trial by an official referee is desirable in the interests of one or more of the parties on grounds of expedition, economy or convenience or otherwise.
Quite often, they would be better described as construction referees than as official referees.
In practice, the business consists largely of cases concerning civil or mechanical engineering works and building and other construction work, claims by and against specialised professionals, such as engineers, architects, surveyors and accountants, claims by and against local authorities relating to their statutory duties concerning the development of land or the construction of buildings, and proceedings between landlords and tenants in respect of breaches of repairing covenants.
Not all the work relates to bricks and mortar. Some of it consists of cases relating to the quality of goods sold or hired, claims in respect of work done, materials supplied or services rendered, and the examination of accounts, especially where they are complicated. But one common factor in all this is that complex questions of fact, often of a scientific or highly technical nature, usually have to be determined. The sums involved are often substantial — many cases running into hundreds of thousands of pounds and some into millions of pounds.
For many years, until last year, there were three official referees, all in London, though on occasions they try cases outside London. But since 1971, under the power given to the Lord Chancellor under the Courts Act, he has nominated additional circuit judges outside London to deal with official referees' business. These additional official referees do not deal continuously with this kind of work and do not get the additional salary paid to those based at the Royal Courts of Justice engaged in it full time. I take on board the need to have judges who are experienced in the technical work that they are bound to try.
The volume of the work of official referees has increased substantially in recent years. Some figures, in addition to those already given to the House, will illustrate

this. In 1973 there were 588 new cases in their lists in London. At the end of that year outstanding were 586. By 1983, the figure for new cases had risen to 989 and the outstanding cases figure was 1,537. According to the estimates of the parties, that represents about 6,000 judge-days of work. But it has to be remembered that a substantial majority of these cases are settled before they come to trial. Nevertheless, in view of this rising work load, the Lord Chancellor appointed a fourth official referee last year, and he has now authorised an increase in the establishment to six, though that figure will be reviewed when the next retirement of an official referee occurs. The Lord Chancellor is also reviewing the adequacy of the arrangements for dealing with official referees' business outside London.
Court and other accommodation is a problem. The fourth official referee is inadequately accommodated as it is, and more, of course, will be needed for the increased establishment. This is a matter that is being urgently looked into. But if we are to talk of putting a gallon into a pint pot, unfortunately the same applies when we come to find accommodation within the Royal Courts of Justice.
My hon. Friend asked about the status of the official referees. The Lord Chancellor is aware of suggestions that have been made from time to time that the official referees should be given the status of High Court judges, but he has at present no plans for altering the existing situation which, apart from the relatively small adjustment made by the Courts Act, has continued for 100 years. As regards salary, as I have indicated, the official referees have a small salary lead over other circuit judges; the size of that lead is at present under review by the Top Salaries Review Body as part of the general review of judicial relativities.
I end by paying tribute to all official referees for the huge amount of work that they do. If, for example, in their lists—even triple banked—all three cases are settled, they do not have a day off. They are usually sent cases from the High Court to try. I am sure that all of us in the House will wish to thank them for and congratulate them on the very important part that they play.

Question put and agreed to.

Adjourned accordingly at two minutes to Three o'clock.